Every investor aims to earn a high profit and get a return from their business. The franchise business is one of the safest and easiest ways of earning profit.
However, thousands of companies are offering franchises, some have the potential to earn the highest profit, and some don’t make as much profit as you expect.
Profitability depends on different factors like brand, marketing strategies, investment, and so on.
So, analyzing the factors is most important before investing in the franchise.
In this article, we will examine how much does a Chick-Fil-A franchise owner makes and whether owning the Chick-Fil-A franchise is profitable.
Chick-Fil-A is a family restaurant known for its delicious chicken. It is the nation’s largest chicken chain.
They use 100% whole breast meat with no added fillers or hormones. They have different business strategies and always focus on a small menu and on customer services.
Originally, Chick-Fil-A was founded in 1946 by Truett Cathy as “The Dwarf Grill .” However, in 1967, it was renamed “Chick-Fil-A .”
Today, it is a privately held and family-owned restaurant with over 1565 outlets in the USA. They offer franchises with solid principles when it comes to menu innovation and catering.
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How Much Does A Chick-Fil-A Franchise Owner Make?
As per record, the average Chick-Fil-A restaurant generates $5.3 million in annual sales, which is way more than the lead quick-service chicken restaurants in America.
An individual franchisee makes approximately $200,000 to $240,000 annually after considering annual fees.
Also, it has over $10 billion in annual system-wide sales. This calculation is based on the average restaurant’s earnings and the percent gross that operators take.
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What is Chick-Fil-A Best known for?
Chick-Fil-A restaurant is known for its exceptional chicken sandwiches. Moreover, its menu includes a variety of chicken cuisine, fries, sandwiches, beverages, etc.
The most popular items at Chick-Fil-A are the following:
- Chicken Nuggets
- Cobb Salad
- Grilled Chicken Nuggets
- Market Salad
- Waffle Fries
- Spicy Southwest Salad
All the items are most demanded and loved by customers. Additionally, Chick-Fil-A is also known for its best pleasant dining experience, great taste, reliable quality, low price point, and progressive attitude towards nutrition and animal welfare.
Pros And Cons Of Chick-Fil-A Franchise
Pros of Chick-Fil-A Franchise
- Chick-Fil-A is the lowest-cost franchise
- Have solid principles, and many of the logistics are taken care of for you.
- Never comprise with the quality of food
- Prior training program for the all-new franchise
Cons of Chick-Fil-A Franchise
- Remain close on Sunday, Christmas Day, and holidays which affect the sales.
- Has a long selection process for franchise
- Not allowed to operate multi-units
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Chick-Fil-A Franchise Average Revenue & Profit
According to the data available, the average revenue for a Chick-fil-A franchise is around $5.3 million per year.
This is a considerable amount of money and can be used to cover all associated costs, such as staff wages, rent, and other expenses.
Furthermore, due to the huge popularity of the brand, owners typically see a steady increase in sales over time.
In terms of profits, most owners make a percentage of their gross sales – usually somewhere between 5% and 7%.
This means that, on average, Chick-fil-A franchise owners would make approximately $200,000 to $240,000 annually after expenses.
The exact amount they make depends on several factors, including the size of their restaurant and the strength of their local market.
While this may seem like an impressive sum, it’s important to remember that these figures do not take into account any additional investments made by franchisees, such as marketing or renovations.
Additionally, it also does not include any salary that an owner might pay themselves for running the business.
Typically, non-mall units have the highest sales volume and thus generate the best returns on investment.
Mall units, while profitable, tend to generate smaller profits and revenues due to the mall’s percentage of sales.
Chick-fil-A Franchise Failure Rate
Chick-fil-A franchise owners benefit from the fact that the business has a low failure rate. According to industry estimates, the failure rate of Chick-fil-A franchises is under 5%, meaning that most owners are successful in running their own restaurants.
This is due in part to the strong and supportive culture of the company, which seeks to foster long-term success among its franchisees.
The company also offers extensive training and support to new owners, providing them with the tools they need to succeed.
The franchise retention rate is equally impressive; over 96% of Chick-fil-A franchises have been operating for at least 50 years.
This is an acknowledgment of how successful and profitable owning a Chick-fil-A franchise can be, as well as a testament to how well-supported and valued each owner is by the company.
Owning a Chick-fil-A franchise requires significant investment and commitment, but this comes with considerable rewards.
With a low failure rate and high retention rate, aspiring franchisees considering opening a Chick-fil-A restaurant can feel confident in their ability to make it a long-term success.
Chick-fil-A Franchise Payback Period
The payback period of owning a Chick-fil-A franchise is relatively short. The average investment to open a Chick-fil-A franchise is around $1,363,510.
After taking into account the cost of rent, wages, and other expenses, the average annual net profit for a Chick-fil-A franchise is approximately 15%.
Using these figures, we can calculate the payback period of a Chick-fil-A franchise using the formula:
Payback period = Investment / Average annual net profit
In this case, that would equate to a payback period of just 2.2 years. This means it takes just over two years for an owner to make back their initial investment and start seeing significant profits from their venture.
In comparison to some other franchises, this payback period is relatively short.
This can be attributed to the strong brand recognition and loyal customer base that Chick-fil-A enjoys, which helps drive strong sales every year.
Furthermore, due to its high-quality products and customer service standards, most owners find it easy to retain customers and draw new ones in as well.
Anything below 4 years is a reasonable payback period for any franchise, making Chick-fil-A an attractive option for aspiring franchisees looking to make a return on their investment.
Chick-Fil-A Might Be The Hardest Franchise To Get
Chick-fil-A is one of the most popular fast-food chains in the United States, with a consistently growing customer base and many loyal fans.
While this may make it seem like a desirable franchise to own, aspiring owners should be aware that it is actually very difficult to get accepted into the Chick-fil-A franchise program.
Each year, the company receives more than 40,000 applications from potential franchisees hoping to open their own Chick-fil-A restaurant.
However, they only accept between 100 and 115 applicants each year – making the acceptance rate less than 0.25%.
This means that getting accepted into the company’s franchising program is significantly harder than getting accepted into Harvard University!
To become a Chick-fil-A franchisee, applicants must first fill out an initial “expression of interest” form online.
If selected, they will then complete a formal written application before being invited for recorded video and in-person interviews.
This rigorous process allows Chick-fil-A to select only those committed and able to provide the highest quality customer service possible.
The standards for owning a Chick-fil-A franchise are so high that some have even compared them to join an exclusive club or fraternity.
Many aspiring owners simply do not have what it takes to meet all of these requirements and therefore fail in their attempt at ownership.
Facts About Chick-Fil-A
Now that you have a better understanding of how much a Chick-fil-A franchise owner makes and the challenging process of becoming one let’s take a look at some of the other facts about Chick-fil-A.
● Chick-fil-A is the largest quick-service chicken restaurant chain in the United States, with over 2,600 locations across 47 states and Washington, DC.
● The chain achieved its first billion dollars in sales in 2000.
● All Chick-fil-A restaurants are closed on Sundays to give employees time for rest and worship.
● The company’s signature menu item is the original chicken sandwich which consists of breaded chicken breast served on a buttered bun with two pickles.
● The name “Chick-fil-A” is a combination of the words “chicken” and “filet” since the company specializes in chicken filet sandwiches.
● The chain is known for its exceptional customer service, with employees trained to say phrases like “my pleasure” rather than just “you’re welcome” to make customers feel appreciated.
● Chick-fil-A’s mascot is a cow, and the company encourages customers to “Eat Mor Chikin” as part of its advertising campaign.
● Since 2005, Chick-fil-A has been celebrating Cow Appreciation Day second Tuesday of July, where customers can get free food if they dress up as a cow.
● In 2018, Chick-fil-A became the first fast food restaurant to sell meal kits that could be prepared at home, containing all necessary ingredients, including premeasured sauces and dressings.
Chick-fil-A is one of the largest quick-service chicken restaurant chains in the United States, with over 2,600 locations across 47 states and Washington, DC. The chain achieved its first billion dollars in sales in 2000 and has continued to grow year on year ever since.
According to a 2022 report by Zippia, Chick-fil-A ranks as the seventh largest U.S. fast food chain based on U.S. system-wide sales.
It is currently reported that there are over 2,600 operational stores for the franchise across America and over 300 company-owned locations.
This represents a total number of over 2,900 operational Chick-fil-A stores across all states, including Washington, D.C., as of 2023.
In terms of closures within the Chick-fil-A franchise system in the past few years, there have been very few.
The only notable closure in 2021 was the closing of a nearly-50-year-old Chick-fil-A store at Brookwood Village mall in Birmingham, Alabama, due to Covid and other reasons.
In June 2022, Chick-fil-A Franklin Square, which was the only Chick-fil-A location in the city, closed its doors, but this was replaced by a new store on Cox Road.
Chick-fil-A’s franchise retention rate has been over 96% for at least 50 years, so not many stores have had to close due to the high standards and rigorous selection process that owners go through before they can become Chick-fil-A franchise owners.
Is Chick-Fil-A franchise Profitable?
Well, as we discussed, profitability depends on different factors. And the most important factor of profitability is an investment.
The investment is always proportional to profit. Chick-Fil-A franchise is the lowest-cost franchise but still has the potential to make the highest profit because of its brand recognition.
In the past year, Chick-Fil-A made its goodwill in the fast-food industry, and customers always appreciate its services.
So, brand-building also plays a vital role in profitability. Chick-Fil-A’s average revenue is the highest of any fast-food chain in the USA. It average generates $4.2 million per store.
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Chick-Fil-A offers a lucrative franchise with its intense belief and values. But it has a rigorous application and interview process.
To open a franchise, you will have to go through approximately 12 interviews or more. They will drop you if you don’t meet their criteria.
And if you are selected as a franchisee, Chick-Fil-A is going to have a tight grip on your lifestyle.
Despite this, the Chick-Fil-a franchise has the potential to earn high profits at the lowest cost.
Many companies charge higher franchise fees, and half of the franchise profit goes as a franchise fee.
So, select wisely before investing in any franchise. Read all the perspectives; it will help to make the right decision.
Frequently Asked Question
What is the initial investment required to open a Chick-Fil-A franchise?
Opening a Chick-Fil-A franchise requires an initial investment of $10,000
What is the average revenue of a Chick-Fil-A?
A Chick-Fil-A may expect to make roughly $200,000 annually as of 2022.
Who can be eligible for Chick-Fil-A Franchise?
The licensing opportunities are available to licensed food service providers and self-operated food service providers. Individuals are not eligible for licensing opportunities.
Amit Gupta is the founder of DrFranchises – a digital marketing agency that helps brands rank better on Google Maps through local SEO strategies. Amit has over 11 years of experience in digital marketing, SEO, email marketing, and social media marketing. He’s also the owner of multiple franchises and has helped countless brands achieve success online. When he’s not working, Amit can be found playing with his dog.