The most profitable fast-food franchises of 2024

Fast-food and quick-service restaurants (QSRs) have a long history within the franchise industry. Some of the best-known brands in the world, like McDonald’s, Burger King, and Papa John’s, franchise their processes and systems to allow independent owners and operators to expand the network. While there are hundreds of fast-food and QSRs to choose from, selecting a profitable franchise is the best way for franchisees to ensure success and scalability.

But what makes a fast-food franchise profitable? What factors should a potential investor consider when investing in a fast-food or QSR franchise? 

There’s a lot of data to wade through, so we’ve done some of the legwork in compiling the most profitable fast-food and QSR franchise options of 2024. In this article, we cover:

• What makes a great fast-food franchise
• Why the QSR industry is great right now
• Our top picks for the most profitable fast-food franchises in 2024

What makes a great fast-food franchise?

The answer to this question comes down to some key factors about a particular franchise: its operations, revenue streams, leadership, processes, and of course, its products. Let’s look at these one by one.

Efficient operations

A profitable fast-food franchise thrives on efficiency. Strong operations directly translate into more revenue; they can serve more customers at a higher velocity. Back-end efficiency counts as well, reducing product shortages for fewer gaps in the menu.

More efficient operations also translate into money saved. Keeping restaurants well-staffed and efficiently run means less money is owed for overtime wages and for keeping the location maintained.

Much of this efficiency comes from the franchise’s corporate headquarters, as it gets new franchisees up and running. Pay attention to how quickly the brand onboards new franchisees, and scrutinize whether location owners are set up for success. Network saturation and construction are also important indicators of a healthy and efficient brand.

Location and saturation

When looking for the most profitable franchises, remember that location and network availability matter. A strong franchise will offer operators room to grow if they so choose. Look for a brand with a wide network and availability for prospective multi-unit owners (MUOs). 

While franchises with more locations in more expensive zip codes might pull in more revenue in terms of raw dollars, facility costs like rent and wages will probably be higher. Likewise, cities and states have differing regulations about worker payments, contracts, hours, and taxes, among others. All of this can lead to some geographic regions – like the suburban Southeastern United States – being perceived as more “business friendly” than others.

Diversity of location can be a compelling signal, too. If a franchise has multiple successful, profitable operations in a range of locations, it indicates an overall potential for growth and stability. But if a franchise seems maxed out in a specific geographic region, that introduces some more nuance: have they figured out how to break out of that region? Are they still growing within that region, or are they at a saturation point? These strategy questions will unearth companies that are primed for future growth.

Strong revenue

Revenue, as the basis of profit, is a prerequisite to profitability. Since the fast-food and QSR industry has comparatively high build-out and commodities expenses, margins matter. Strong, consistent revenue is a special focus for food service investors.

You can judge a franchise’s revenue by assessing its typical EBITDA (earnings before interest, taxes, depreciation, and amortization) and making some educated guesses. Keep in mind, though, that EBITDA is not a perfect metric. It isn’t standardized by generally accepted accounting principles (GAAP) and doesn’t account for operating expenses, so it’s not a “desert island” metric for franchise finances. Still, for the purposes of assessing revenue, EBITDA is perfectly adequate. 

Not every franchise discloses its total financial performance, but look at Item 19 of the Franchise Disclosure Document (FDD) to get a better understanding of performance.

Experienced leadership

Great companies require great leaders. What counts as great or experienced often varies based on personal taste, so use your best judgment as you investigate the franchise’s founders. Do they have any business training? previous business experience? How long have they been running this franchise? Who have they brought on to help them grow the business?

Larger, better-known, well-established franchises should not be exempt from this kind of scrutiny, as they, like any company, might bring in new leaders to change the brand’s direction. 

Franchisee support

How does this company support its newer franchisees? This applies both to onboarding support and new franchisee training, as well as providing ongoing support for location owners.

While you can’t learn a lot about support from documentation, many prospective franchisees contact current owners to learn about headquarters support. Many franchises describe the precise support they offer in the franchisee marketing information on their website.

One final metric to consider is the number of closed locations within the previous three to five years. While there’s nuance to this number – such as locations that transfer owners or leave the business for other interests – it is an additional point to be investigated. Investors should closely examine high numbers of closures, defaults, or lawsuits.

Why fast-food/QSRs?

The fast-food and QSR industry is booming right now, with strong economic growth predictions through 2030 across all continents. That’s only six years off – a relatively short time frame from an investing perspective.

The fast-food industry is taking full advantage of technological advancements to improve operational efficiency and serve its target markets. As technology continues to grow more sophisticated, the QSR sector will improve efficiency and combine that with the valuable insights new technology provides.

Finally, although QSR faces challenges as Gen Z – the most likely generation to eat plant-based and demand sustainable, unprocessed foods – comes into its own as a consumer demographic, the QSR industry is well-positioned. Many QSRs are offering wellness-focused options to meet demand, and existing QSR franchises are adding or changing menu items to adapt. 

Most profitable fast-food franchises of 2024

We understand that doing the research and compiling a list of top franchises can be a daunting task, so we took the liberty of doing it for you. Here are our picks for this year’s most profitable fast-food/QSR franchises.

Panera Bread

The Kirkwood, Missouri-founded Panera Bread needs no introduction. It offers over 1000 locations mostly concentrated in the United States and a few Canadian locations in the greater Toronto area. Franchising since 1997, Panera Bread is positioned to remain a leading, profitable contributor to the QSR sector’s growth for years to come.

Fast facts

• Locations: 1,089
• Founded: 1987
• Franchised: 1997
• EBITDA: $462,073
• Startup cost: $1,123,000 – $3,841,000
• Franchising fee: $35,000

Wendy’s

Famous among Millennials and Gen Z for its creative social media marketing, Wendy’s is proving its ability to grow, pivot, and remain profitable across shifting demographics. And with more than 7,000 locations worldwide – and growing – it’s no surprise that Wendy’s makes our list of most profitable fast-food franchises.

Fast facts

• Locations: 5,591
• Founded: 1969
• Franchised: 1972
• EBITDA: $322,585
• Startup cost: $1,985,000 – $4,622,000
• Franchising fee: $50,000

Zaxby’s

Zaxby’s has long been a Southeastern United States mainstay, with 776 locations serving up some of the best fried chicken the QSR industry has to offer. The company’s high EBITDA and market dominance in the American South means Zaxby’s is well-positioned to expand into neighboring markets like the mid-Atlantic and Midwest. 

Fast facts

• Locations: 776
• Founded: 1990
• Franchised: 1994
• EBITDA: $310,613
• Startup cost: $1,391,700 – $3,266,200
• Franchising fee: $35,000

Spitz

A fast-casual restaurant franchise, Spitz is known for its Mediterranean, Greek, and American favorites. Its name is derived from a method of broiling meat, but the restaurant’s vegan offerings are popular among Millennials and Gen Z diners, ensuring there’s something delicious for everyone. Spitz is one of America’s top up-and-coming chains, and its revenue has increased every year, despite the fact that its franchising growth has been a bit slow.

Fast facts

• Locations: 11
• Founded: 2005
• Franchised: 2013
• EBITDA: $245,953
• Startup cost: $564,250 – $1,115,050
• Franchising fee: $35,000

QDOBA

Denver, Colorado-founded QDOBA is the largest Mexican fast-casual franchise in the United States, which makes it the obvious pick for those interested in this slice of the market. QDOBA just announced rapid expansion plans to be implemented over the next few years, making this a franchise worth watching.

Fast facts

• Locations: 447
• Founded: 1995
• Franchised: 1997
• EBITDA: $240,226
• Startup cost: $489,200 – $1,178,000
• Franchising fee: $30,000

Invest fractionally in franchises with FranShares

Now that you’re familiar with some of the most profitable fast-food franchises of 2024, you might be wondering about the best way to get a piece of the growing market. If opening a location isn’t in your investment plan, you can still access franchising through passive, fractional franchise investing with FranShares. We give retail and accredited investors access to all the benefits of franchising with low investment.
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