Why Is It So Cheap To Invest in a Chick-fil-A?

Chick-fil-A is one of the most sought-after concepts in the franchise space. The franchisor has certainly played into this demand with its exclusive but incredibly attractive franchise policies.

Franchisees can invest for just $10,000, a fraction of the price tag that accompanies many other big-name quick service restaurant (QSR) concepts. This franchise fee and “a holistic commitment to own and operate the business in a hands-on manner” is all a prospective owner needs to commit. Chick-fil-A covers build-out costs, real estate and equipment.

The catch is that this leaves the franchisees in more of an operator role than one of an owner. Chick-fil-A operators pay 15% in royalties, and 50% of profits go to corporate. Further, because the franchisee did not fund the build-out, they do not own the restaurant and therefore cannot sell it should they decide to transition out of the business. 

Clearly, though, these contingencies haven’t slowed down interested franchisees. Chick-fil-A receives tens of thousands of inquiries annually, and it tends to accept about 1% of applicants.

Do You Get What You Pay For?

In the franchise world, a total initial investment of $10,000 is pretty low. Is the Chick-fil-A franchise a “get what you pay for” situation? Not really.

Of course, some franchisees go into business with hopes of building up an empire and a strong business that can be passed down to family members. Though this isn’t the case with Chick-fil-A, as operators cannot sell their locations, direct ownership of a business certainly is not the only path to generational wealth.

According to the brand’s most recent Franchise Disclosure Document (FDD), its U.S. systemwide sales were nearly $19 billion in the previous year, a notable increase from 2021’s $16.6 billion, 2020’s $13.7 billion and 2019’s $12.2 billion.

Chick-fil-A locations with a drive-thru averaged over $8.5 million in sales per unit, and the highest-performing location secured nearly $17 million in revenue. Yes, these stats are lowered significantly when the corporate cut is taken out, but a multi-million dollar operation is nothing to sneeze at.

These revenue representations are reflective of so much more than just customers’ motivation to buy chicken. A Chick-fil-A franchisee’s initial investment brings them into the notorious network of business owners, and they unlock access to the appeal of the Chick-fil-A name. The customary “My pleasure,” freakishly efficient multi-lane drive-thrus, innovative marketing and core menu of chicken-based entrees all serve as key differentiators for the concept, drawing even more customers in. 

To access all of these well-established practices and its reputation, $10,000 may not seem too bad … even if you do have to fork over half of your profits. After all is said and done, it is reported that Chick-fil-A operators do take home a decent salary. Mashed reports an average of around $200,000 annually, while reported salaries on Glassdoor average $82,065 annually, with the top of the range sitting at about $138,000. For owner-operators who have a true passion for people, service and even the brand itself, $10,000 can unlock an opportunity that is rewarding in more ways than one.