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The Pros and Cons of Owning a Chick-fil-A Franchise

The good news is opening a Chick-fil-A franchise only costs $10,000 in franchise fees, but there are other considerations that aspiring franchisees must know.

By Victoria CampisiStaff Writer
9:09AM 03/02/24

Chick-fil-A is one of the most recognizable names in fast-food, making it a popular choice for aspiring franchise owners. Known for its chicken sandwiches, “my pleasure” culture and notoriously low-cost franchise fees, the franchisor sees tens of thousands of applicants every year. 

Are you considering applying? Here are a few pros and cons to consider. 

The Pros

One of the major benefits of owning a Chick-fil-A franchise is the investment versus the profit. Unlike many fast food chains, which can run franchisees hundreds of thousands or even millions of dollars, all it takes to open a Chick-fil-A is a $10,000 franchise fee. The brand also has no requirements for minimum net worth or liquid assets.

On average, a Chick-fil-A franchise generates $8.1 million in annual sales, according to data from finance platform SharpSheets. Of course, this varies from location to location. Franchises in malls, for instance, see a decrease to $2.7 million, while non-mall units have an average annual sales figure of $8.6 million, resulting in an earnings before interest, taxes, depreciation, and amortization (EBITDA) of $1.3 million — a 15% margin. 

Before opening, franchisees can feel confident about running their business due to the brand’s extensive training. During a multi-week program, they will learn everything about running the business, including hiring and training employees and how to deliver Chick-fil-A’s outstanding customer service. 

Chick-fil-A franchisees also benefit from strong brand recognition and a loyal customer base. In fact, the brand has taken the number one spot on the American Customer Satisfaction Index for the past nine years

With the brand being famously closed on Sundays, Chick-fil-A franchise owners might also experience a better work-life balance than if they were franchising with another fast-food brand. 

The Cons

If the opportunity sounds too good to be true so far, here are a few considerations to keep in mind. First off, Chick-fil-A is extremely competitive to be accepted into. As of 2019, approximately 60,000 potential franchisees apply for business ownership with the brand each year; only 1% of these applicants are approved. 

Those who are selected to be franchisees must have full-time availability for day-to-day operations of the restaurant, meaning this is not a passive opportunity. If you’re looking to add another brand to your portfolio, Chick-fil-A is not the business for you. 

And while the investment is one of the cheapest in the business, Chick-fil-A charges a 15% royalty and takes 50% of all profits for franchisees. This is a much steeper structure than other quick-service brands, which typically range around 4% to 6%

There is also less control involved with opening a Chick-fil-A. For selected operators, the brand manages the majority of the startup process, such as selecting the restaurant site and distributing necessary equipment rentals. 

While the benefits of a Chick-fil-A franchise are certainly undeniable, ownership is not without its hurdles. Aspiring franchisees should carefully weigh these pros and cons before taking the plunge into buying the franchise. 

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