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How much is a Chick-fil-A franchise?

March 8th, 2024 By Emily Norwood

Chick-fil-A is an American fast-food restaurant franchise that specializes in high-quality chicken sandwiches. But in terms of franchising, Chick-fil-A is known for having lower-than-average costs of entry than other franchises. How does that work? And what makes Chick-fil-A such an attractive investment?

In this article, you’ll learn:

  • What Chick-fil-A is known for
  • How Chick-fil-A stacks up against other quick-service restaurants (QSRs)
  • How Chick-fil-A’s structure sets its franchisees up for success
  • Why a Chick-fil-A franchise is desirable to franchisees

What is Chick-fil-A?

One of the most recognizable brands in the United States, Chick-fil-A is a quick-service restaurant and fast-food chain that specializes in chicken sandwiches, chicken nuggets, and Southern waffle fries, among other delicious foods. The brand prides itself on serving only real breast meat with no fillers, artificial preservatives, hormones, or steroids. 

How does Chick-fil-A stack up against other QSRs?

Chick-fil-A doesn’t cleanly compare to other QSRs because its franchising model works differently than the typical restaurant franchise. But we can still compare them as businesses.

First, Chick-fil-A is extremely profitable. Its 2022 revenue, nearly $19B, rivals or surpasses some of the most well-established giants of the QSR industry, including Taco Bell, Wendy’s, and Burger King. Chick-fil-A’s per-unit revenue is higher than any of them.

Second, Chick-fil-A is primarily a domestic chain. While the franchise operates a few locations in Canada, most of its units are across all U.S. states with the exception of Alaska, Hawaii, and Vermont which do not have Chick-fil-A locations. Comparable franchises have many international locations outside English-speaking North America, but Chick-fil-A’s focus is on the domestic market.

Finally, Chick-fil-A has a popular product with a strong customer base. Despite some controversy around the company’s politics, according to the June 2023 American Customer Satisfaction Index report, Chick-fil-A remained the United States’ favorite restaurant brand for the ninth consecutive year. 

So Chick-fil-A is profitable, hyperfocused on the American consumer, and enjoys unmatched levels of customer satisfaction. So how does the brand accomplish all this on a practical level?

Unique operator-to-location model

Chick-fil-A wants qualified individuals to run its franchise locations. To do this, the company has structured the process of becoming a franchisee differently than typical franchises.

Tough competition 

First, Chick-fil-A has an extremely competitive application process for becoming a franchisee. Just as potential franchisees do their due diligence on any company they want to be part of, Chick-fil-A does its due diligence on potential franchisees. “Yes, the Chick-fil-A local Owner-Operator selection process is highly competitive, and well, selective,” the company acknowledges on its website. “Thousands apply each year for relatively few restaurant opportunities.”

So who are these successful Chick-fil-A franchisees? They’re people who are willing to become highly involved in the location’s day-to-day operations; those who are willing to invest time and energy in the business. What all these owner-operators have in common, says Chick-fil-A, is “an entrepreneurial spirit, a passion for helping others, and a deep desire for caring for the community.”

Owner-operator involvement

Another factor that makes the Chick-fil-A franchise unique is the requirement for franchisees to be the full-time operator of their location. In other words: part-time owners or owners who hire a manager to oversee operations for them won’t make the cut. You cannot be a Chick-fil-A franchisee and expect to earn passive income.

While this weeds out a lot of applicants who might not devote the level of effort Chick-fil-A corporate expects, for aspiring franchisees, it offers a clear set of selection criteria: Chick-fil-A looks for strong leaders with proven track records in business leadership; self-starters who have proven they’re capable of taking on a Chick-fil-A location.

After all, the company isn’t shy about stating that owning a Chick-fil-A is a “life investment.”

What Makes Chick-fil-A desirable to franchisees? 

There’s no denying that Chick-fil-A franchisees enjoy strong brand recognition, huge profits, and excellent support from Corporate. But another major reason so many people want in on the Chick-fil-A success story is because of how incredibly franchisee-friendly the company is. 

For instance, Chick-fil-A’s initial franchise fee is only $10,000 – significantly lower than most other franchises. Chick-fil-A keeps its startup costs low by shouldering the costs of building and preparing the physical location, along with other expenses related to starting a new restaurant.

With some of the lowest startup costs of any franchise, financial resources aren’t a significant barrier to becoming a Chick-fil-A owner – but there are other requirements to consider. While franchisees pay much less upfront, during their time as business operators, they owe more of their earnings to Chick-fil-A corporate. Also, they do not own the building that houses their restaurant, nor do they own the equipment. 

Each Chick-fil-A location is required to allocate a percentage of its “Base Operating Service Fee” (BOSF) to royalties. Currently, the BOSF is 15% of gross sales and 50% of all net profit – a far cry from the 3% to 15% of royalties that most franchises require from their franchisees. In that sense, Chick-fil-A franchisees are more like tenants running a business on behalf of Chick-fil-A in exchange for a salary commensurate with their success rather than franchisees. 

Still, running a Chick-fil-A is profitable for franchisees. Although the company doesn’t publish data about operator-owner earnings, Franchise Business Review reports that the average Chick-fil-A franchise owner “earns a very respectable [annual] income in the range of $150,000.” Even when adjusting for the typical 60-hour work week (and the restaurant being closed on Sundays), that’s still more than what franchisees of other quick-service restaurants typically can expect to earn.

So, a clear picture of Chick-fil-A begins to emerge: the financial barrier to entry is low in order to attract talent with experience working in the food service industry. By attracting those qualified people, selecting only the best, and then requiring them to be owner-operators of their restaurants, Chick-fil-A seems to have a recipe for success.

After all, the company’s steady, unrivaled growth speaks for itself.

Is Chick-fil-A for you?

Chick-fil-A’s process leads to extremely dedicated franchisees, and that leads to increased customer satisfaction, stronger brand loyalty, and higher profits across the board.

For investors, those are all attractive qualities. If you are an investor who finds Chick-fil-A’s success story compelling – but who has no plan to become a franchisee – consider passive fractional franchise investing with FranShares. Our approach offers high earning potential and diversification in a completely passive investment model. We give both retail and accredited investors access to all the benefits of franchising with low initial capital outlay and zero fees.

To learn more about FranShares and this unique opportunity, sign up for our platform on our website.

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