How Much Does a Chicken Franchise Cost?

Are you interested in learning how much a chicken franchise costs? If so, you’re not alone.

At Del Taco, questions about the franchise investment, fees, and royalties are some of the most common we receive.

In this article, we will take a look at how much it costs to start a chicken franchise.

Chicken Franchise Cost Breakdown

The total cost of your chicken franchise can vary significantly depending on several factors including:

• Franchise Fee: This is a one-time payment to the franchisor for the right to use their brand, systems, and support.
• Initial Investment: This includes the cost of the franchise fee, equipment, inventory, leasehold improvements, and working capital.
• Ongoing Royalties: These are recurring payments to the franchisor, typically a percentage of your sales.
• Advertising Fees: You may be required to contribute to a franchise-wide advertising fund.

There are several other factors that can influence the overall cost of your chicken franchise:

• Location: Prime locations in high-traffic areas will generally be more expensive.
• Size of the Franchise: Larger franchises may require a higher initial investment.
• Level of Customization: The degree of customization you want in your restaurant can affect costs.
• Experience Level: If you have no prior business experience, you may need to invest in additional training or consulting.

At Del Taco, we carry a wide variety of freshly grilled and crispy chicken tacos, burritos, and strips. This is how our costs breakdown based on our 2024 FDD:

• Franchise Fee: $35,000 per Location
• Royalty Fee: 5% of Net Sales
• Advertising Fee: 4% of Net Sales
• Estimated Initial Investment: $1,312,200 - $3,085,000

Due to these costs that will make up your initial investment, we have two financial requirements all of our potential franchisees must meet:

• Minimum Liquidity: $500,000
• Minimum Net Worth: $1,000,000

Please note, these requirements for liquidity and net worth will vary by how many restaurants you commit to develop.

Franchise Fee & Royalties: What Do I Get?

Paying your initial franchise fee and ongoing royalties will grant you access to a wide variety of assets and services designed to help you run your restaurants.

Here are a few of the items you’ll receive at Del Taco:

• Use of the Del Taco® brand name, systems, logo, and store design.
• A comprehensive Management Training Program designed to prepare you for daily operation of your restaurant.
• Site selection support.
• Construction & design support. Conceptual floor plans and site plans are provided. These must be sealed by an approved architect before submitting them to local government entities.
• Step-by-step assistance through the process of new-store layout, ordering of equipment, furniture, and fixtures.
• Support and training assistance in pre-opening and opening.
• Ongoing support from: Franchise Business Consultants, Culinary & Innovation Team, and R&D. Plus, purchasing, distribution, and marketing support for your restaurants.

When you pay your franchise fees and royalties, it will ensure you have the best possible resources to run your chicken franchise and bring customers to your location.

How to Finance Your Chicken Franchise

Due to the financial requirements of opening a chicken franchise, you may need to consider your financing options to get started.

Some of the most popular financing methods in the franchising industry are:

• Small Business Administration (SBA) Loans
• Franchisor Financing
• Commercial Bank Loans
• 401k Rollovers
• Business Partners
• Stocks & Bonds

At Del Taco, we do not provide direct franchisor financing. However, we can provide a list of banks who have expressed interest in lending to our franchisees.

Consider Multi-Unit Franchise Incentives

One way to reduce your chicken franchise costs is by asking if the franchise you’re interested in offers multi-unit development incentives.

Del Taco offers an incentive for multi-unit franchisees who choose to sign up for three or more stores under our Development Incentive Program.

Eligible franchisees are able to take advantage of reduced royalties during the first five years their location is in operation.

The royalty fee (5% of Net Sales) will be reduced to 1% for the first year, 2% for the second year, 3% for the third year, 4% for the fourth year, and 5% for all subsequent years.

Check Out These Additional Resources

We hope this article gave you a better understanding of how much a chicken franchise costs.

At Del Taco, we work with our franchisees every step of the way in order to bring their business ownership dreams to life.

Here are some additional online resources you may like to check out:

• Which Burrito Franchise Makes the Most Money?
• 5 Reasons to Purchase a Del Taco Franchise
• Del Taco vs Taco Bell: Which Franchise Is Best?

If you have any questions, please contact our franchise sales and support team.