Mexican food is getting increasingly popular all over the United States, with new restaurants popping up.
Most of these Mexican restaurants offer distinct tastes, and the good ones get easily popular among the communities.
Café Rio is one of the popular Mexican restaurants that has been serving people for almost two decades now.
You might have thought to own a Café Rio as a franchisee to take a piece of their popularity.
Luckily, Café Rio has been franchising their business to increase their exposure in different states across the United States.
Let’s take a look at how much it costs to own a Café Rio franchise and other details surrounding their franchising business.
About Café Rio
Cafe Rio is a chain of fast-casual restaurants that specialize in serving Mexican cuisine. They are known for their authentic Mexican atmosphere combined with their delicious cuisine.
They serve made-from-scratch dishes, including burritos, tacos, salads, and enchiladas.
The reason why they got popular so quickly and grew to over 150 restaurants is the variety of their menu and that they make their dishes from scratch.
In addition to making their dishes from scratch, Cafe Rio uses fresh, high-quality ingredients in all of their food.
Their menu features a range of gluten-free and vegetarian options, as well, making it accessible for many.
To increase its reach, Café Rio also offers catering services for events and parties.
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Café Rio History
Cafe Rio’s history dates back to 1997 when Steve and Tricia Stanley opened the first Cafe Rio restaurant in St. George, Utah.
The duo managed to find a considerable amount of success, leading them to open more stores, reaching 6 in 2004.
Eventually, Bob and Kathleen Nilsen, Spencer K Hill, along with SKM/Apax Partners bought the restaurant chain in 2004 with those six restaurants.
Since then, the chain has grown to over 150 locations across the United States, and they keep on increasing their outlet numbers.
Cafe Rio’s commitment to using fresh, high-quality ingredients and providing excellent customer service has been a key factor in its success. They are now present in 11 different states across the United States.
Café Rio Franchise Model
| Initial Investment | $659,500-$1,025,000 |
| Franchise-Fee | $30,000 |
| Royalty- Fee | 6% |
| Area Requirement | N/A |
| Advertisement-Fee | 2% |
| Total Outlets | 135 |
Interested In Cafe Rio Franchise?
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How Much Does It Cost To Open A Cafe Rio Franchise?
The detailed numbers for opening a Café Rio franchise are not completely available to the public.
However, the total investment that you can expect to make is available, and that is between $695,500 and $1.02 million.
This initial investment covers all the costs related to the opening of a Café Rio franchise branch, from the franchise fee to the equipment.
The franchise fee that you must pay is $30,000, and it’s paid in a lump sum, directly, in advance before making any other investment.
All the rest of the initial investment covers other things, such as property costs, equipment, training, marketing, and other operational costs.
Cafe Rio Franchise Requirements
To be eligible to be a Café Rio franchise, you need to be able to complete some requirements, both financial and personal.
On the financial requirements side, you need a certain amount of liquidity and net worth.
You need to have liquidity of $600,000, which is the money that you should have access to right away.
Then, you need to have a net worth of $1.5 million, which is the total value of everything you own.
On the personal requirement side, Café Rio doesn’t openly talk about what they are looking for in a prospective franchisee.
However, if you would like to increase your chances of getting approved, you need to have some sort of background experience.
An experience in the restaurant industry is definitely a big plus that could help you. Café Rio doesn’t expect the franchisees to have experience with them beforehand.
Cafe Rio Profit & Revenue
Café Rio is a privately owned company that is not publicly traded on any exchange.
That’s why the company is not obligated to report its financial reports to the public, not allowing people to see their profit and revenue numbers.
That’s why Café Rio’s profit and revenue numbers are not available. All the numbers are estimates, and they might not be completely accurate.
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Cafe Rio Franchise Training and Support
Cafe Rio provides comprehensive training and ongoing support program for its franchisees. The training program includes classroom and on-the-job training.
Cafe Rio’s training program lasts for several weeks, and it happens at their corporate headquarters and at a designated training restaurant.
During the training period, franchisees receive instruction in all aspects of restaurant operations, including food preparation, customer service, management, and administration.
The company also provides support in the areas of site selection, lease negotiation, design, and construction.
They offer assistance with the selection of equipment, furniture, and fixtures to ensure that the franchisee’s restaurant is consistent with the Cafe Rio brand.
Cafe Rio also provides ongoing operational support, including advertising and marketing support and access to their proprietary software systems.
Café Rio Comparison
| Company | Franchise Fee | Royalty Fee | Initial Investment |
|---|---|---|---|
| Qdoba | $15,000-$30,000 | 5% | $252,800-$1,096,700 |
| Costa Vida | $30,000 | 6% | $659,500-$1,300,000 |
| Café Rio | $30,000 | 6% | $659,500-$1,025,000 |
Conclusion
Mexican restaurants are getting more popular day by day thanks to their authenticity and different offerings on their menu.
Café Rio is one of those popular restaurants offering a variety of Mexican food with food made from scratch. Luckily, Café Rio also franchises their outlets to those who are interested.
This means that by having the necessary financial requirements and the financial power to pay for the initial investment, you can open a Café Rio franchise.
Although they require about $1.5 million in net worth and $600,000 in liquidity, you can still make good money from a Café Rio franchise once you get the branch operational.
FAQ
Who is the CEO of Café Rio?
David Gagnon is the current CEO of Café Rio. He has been holding the same spot since late 2009.
Will I fail with a Café Rio franchise?
Similar to owning any other business, there is also a chance for you to fail as a Café Rio franchise.
It all depends on your skills as a franchisee, location, and other details. If you can’t do the operational side well, you might fail.
How expensive is it to open a Café Rio franchise?
If you’d like to open a Café Rio franchise, the investment you can expect to make is about $659,500 to $1.2 million in total.
This number includes all the associated costs with opening a branch.
Sources
https://en.wikipedia.org/wiki/Cafe_Rio
Amit Gupta is an experienced expert in digital marketing and co-founder of DrFranchises. With more than 11 years of knowledge in franchise digital marketing, SEO, email marketing, and social media marketing, Amit has helped many brands achieve incredible success online. As a passionate entrepreneur and owner of 7 franchises, he continues to study franchise models, looking at costs, revenue, and profitability to guide brands toward profitable growth. When he’s not working on digital marketing, Amit enjoys spending time playing with his beloved dog.