How Much Does a Taco Franchise Cost?
Are you interested in learning how much a taco franchise costs? If so, you’re not alone.
Are you interested in learning how much a taco business costs? If so, you’re not alone.
At Del Taco, some of the most common questions we receive are related to costs, fees, and royalties.
In this article, we will go over how much it costs to start a taco business.
One of the first costs you’ll be responsible for paying to start a taco business is the initial franchise fee.
This payment is typically due when you sign the Franchise Agreement for each restaurant you plan to operate.
At Del Taco, our initial franchise fee is $35,000 plus a promotional fee of $10,000 for each location.
For multiple locations, you must pay the full franchise fee of $35,000 for the first restaurant plus a $10,000 deposit on the franchise fee for each additional restaurant.
Keep in mind - these fees are nonrefundable, and their amount will vary based on the brand of taco franchise you’re interested in.
Most taco franchises require their franchisees to pay ongoing royalty fees on a regular basis.
For example, the royalties you’ll be responsible for as a franchisee with Del Taco are:
In this case, net sales would include all revenue from your restaurants, except for refunds and sales or similar taxes.
At Del Taco, both of these royalties are paid weekly by electronic funds transfer.
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:
When you pay your franchise fees and royalties, it will ensure you have the best possible resources to run your business and bring customers to your location.
The total number for your overall costs of opening a taco business will depend on a wide variety of factors.
One of the best ways to figure out how much money you’ll need is to research the estimated initial investment for each brand.
The estimated initial investment for a Del Taco Franchise is $1,312,200 - $3,085,000 and includes the initial franchise fees, training costs, inventory, build-out expenses, computer hardware and software, insurance, and three months of working capital.
Your investment will vary for each Del Taco location depending on the market you choose. Please refer to Items 5 and 7 in our Franchise Disclosure Document (FDD) for a clear representation of the total fees and investment needed.
This is simply an estimate, and the actual cost can vary largely depending on the site-specific conditions and requirements for each location.
You might be able to lower your overall taco business costs by asking if multi-unit franchise incentives are available.
Del Taco offers an incentive for multi-unit franchisees who choose to sign up for three or more stores under our Development Incentive Program.
Under the Development Incentive Program for qualified buyers, if you sign a Development Agreement for a minimum of three (3) restaurants to be developed and opened under the development schedule during the time frames specified in the Development Agreement, and certain other requirements are met, you may be eligible for the following incentive:
The Royalty (which is currently 5% of Net Sales) will be reduced to: (i) 1% of Net Sales for the first year; (ii) 2% of Net Sales for the second year; (iii) 3% of Net Sales for the third year; (iv) 4% of Net Sales for the fourth year; and (v) 5% of Net Sales for all subsequent years.
We hope this article gave you a better understanding of how much a taco business 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:
If you have any questions, please contact our franchise sales and support team.
Are you interested in learning how much a taco franchise costs? If so, you’re not alone.
Are you interested in learning how to start a taco business? Owning a taco franchise is a great way to enter the $89B Mexican Restaurant Industry.
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