Can you own a Chick-fil-a Franchise for 10k?

Category: Franchise Business Review

Can you own a Chick-fil-a Franchise for 10k?

Can You Own a Chick-Fil-A franchise for 10k?

Chick-fil-a Franchisee Mininum Requirements

Can you really own a Chick-Fil-A? It sounds too good to be true, right? "All you need to invest in a Chick-fil-A franchise is the $10,000 upfront fee." It is true that the only capital investment required is the $10,000 in non-gifted, non-borrowed funds for the initial franchise fee. However, there are several other mininum requirements you must meet to qualify.

Firstly, you must have the legal right to own and operate a franchise in the United States. The upfront fee of $10,000 must come from non-gifted, non-borrowed funds for the initial franchise fee. Strong finances are crucial; you must have no bankruptcy in your financial history.

In terms of dedication, you must be committed to full-time, hands-on, day-to-day ownership and operation of the restaurant business. Additionally, you need to divest yourself of all non-passive business opportunities to focus entirely on your Chick-fil-A franchise.

Experience is also a key factor, with a requirement of 5+ years of professional work experience. Lastly, leadership qualities are essential, as you must have experience leading a team of people.

Strict Franchisee Selection and Requirements

Meeting these requirements does not mean you will be selected as a franchisee. On average Chick-fil-A recieves approx. 40,000-60,000+ applicants per year, of which the company only accepts about 80. That's less than 0.1% acceptance rate, which means you have a better chance of getting into Harvard, Stanford, or even the US Secret Service!

Chick-fil-A refers to their franchisee's as operators and each is required to work in the location, often spending six days of the week inside their location. Every Chick-fil-A location is closed on Sunday and despite this they are still able to generate more revenue per location than any other resturant chain in the world!

Chick-Fil-A Franchise Costs 2024

Note: you’ll need to cover the initial fee upfront — the subsequent expenses can be paid for using your initial months' revenue or through borrowed funds. However, be aware that this will reduce your personal take-home profit.

Inital franchise fees

  • Franchise Fee: $10,000
  • Opening Inventory: $15,050 to $121,210
  • First Month’s Rental of Equipment: $750 to $5,000
  • First Month’s Rent: $2,605 to $95,180
  • First month’s insurance: $240 to $10,700
  • Additional funds for other store-opening costs: $415,598 to $2,096,696

Chick-Fil-A does not have any additional net worth or liquid asset requirements.

Ongoing franchise fees

  • Base operating service fee: 15% of sales per month
  • Equipment rental: $750 to $5,000 per month
  • Advertising fee: 0% to 3.25% per month
  • Rent: $2,605 to $95,180 per month
  • Insurance: $240 to $10,700 per month
  • Hardware/software support and high-speed internet: $9,500 to $20,000 per year
  • Cash handling system services: $85 to $450 per month

Pros

  • Extremely low start-up costs: only a $10,000 initial franchise fee
  • High average sales volume
  • Turnkey proven business model

Cons

  • Very high ongoing costs
  • History of anti-LGBTQ controversies
  • You can't sell or transfer the business
  • You can only rent the property and equipment from Chick-Fil-A directly
  • Limited opportunites in certain geographical locations

When considering opening a Chick-fil-A franchise, there are significant advantages and disadvantages. The brand clearly seeks franchise owners who are deeply committed.

 

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