KFC Franchise In USA: Costs, Fees & FDD
Started with a roadside restaurant in 1930; who would have imagined Colonel Harland Sanders’ secret fried chicken recipe would evolve into a multi-billion business? The rising number of KFC franchises in USA is an evident example of its enormous popularity.
Today, the KFC franchise is one of the world’s most renowned and beloved restaurant franchises. Even after 90 years, the recipe is still a secret, and the company is serving delicious fried chicken to billions of chicken-lovers in over 125 countries.
It is estimated that over 185 million people, on averagely, go through a KFC Ad at least once a week—the numbers are surprisingly more than half the U.S. population.
Due to the ever-growing popularity, many entrepreneurs are coming forward to own a KFC franchise in USA. The best part is that owning a KFC franchise in USA is relatively easy because of the training and support offered by the brand team.
In this article, we will provide all the information required to become a KFC franchise owner in the US. We will broadly cover key topics, including KFC franchise cost and profit, investment information, franchise requirements and KFC franchise fees.
Kentucky Fried Chicken (KFC): Overview
Kentucky Fried Chicken, popular as KFC, tops the list of the best Chicken Franchises in the USA, specialising in serving fried chicken. It also serves french fries, soft drinks, wraps, salads, desserts, and crushers (milkshakes).
Founded in the year 1930 by Colonel Harland Sanders in Kentucky, KFC opened a second restaurant in 1952 and has been franchising since then. Today, the company has over 24,000 franchise units operating around the world.
However, PepsiCo acquired the company in 1986. With that, KFC became a part of Yum! Brands Inc., which includes other popular brands like Long John Silver’s, Taco Bell and Pizza Hut.
The KFC franchises serve more than 12 million customers each day in more than 115 countries. As of 2022, it is among the most valuable food chain brands to date, and its net worth is around $10 billion. Every year, it gets an average sales of $26 billion.
Take this chance and get yourself involved in this excellent franchise opportunity.
Why Should You Start A KFC Franchise In USA?
Throughout its journey from a roadside restaurant to a multi-billion food business, KFC has frequently been ranked in Entrepreneur’s Franchise 500. Additionally, the firm has received recognition as one of Entrepreneur’s Top Global Franchises and among the Fastest-Growing Franchises.
These rankings are determined by analyzing more than 150 data points in the following categories: fees and costs, size and growth, support for franchisees, brand strength, and financial stability. The best feature of getting a KFC franchise in US is its strong training and support.
Excellent Training & Support Offered
KFC Franchisors provides excellent initial training programs and various ongoing support options to help franchisees operate their businesses smoothly.
|Classroom Training||2 Days|
● Co-op Advertising
● Website Development
● Email Marketing
● Loyalty Program/App
● Ad Templates
● National Media
● Regional Advertising
● Social Media
● Online Customer Support
● Security & Safety Procedures
● Purchasing Co-ops
● Site Selection
● Proprietary Software
● Meetings & Conventions
● Field Operations
● Franchisee Intranet Platform
● Toll-Free Line
● Grand Opening
Strong Emphasis on Innovation
The brand has a strong emphasis on innovation, simplification, and improvement to delight customers. If you are willing to put everything on the line for a business that values progress, your plan to start a KFC franchise in USA can be a wise choice.
On the other hand, starting a KFC franchise may provide a way more predictable outcome than putting money on a completely new brand that might find it challenging to succeed in an industry that is already very competitive.
How Much Does It Cost To Open A KFC Franchise In USA?
In the United States, the total cost/investment to open a KFC franchise is estimated to be between $1,442,550 to $2,771,500. This includes the initial franchise fee of $45,000 and a royalty fee of 5% or above.
Upon applying for the franchise and paying all required fees, you will be granted a license to operate a business under the name – KFC US LLC.
Here’s a complete breakdown of estimated costs incurred in opening a KFC franchise in USA:
|Building & Premise Expense||$534,000||$930,000|
|Initial Deposit Fees||$25,000||$25,000|
|Initial Option Fees||$20,000||$20,000|
|Security Deposits, Permits & Licenses||$50,000||$100,000|
|POS, MERIT, Equipment, Signage, and Furniture||$329,000||$476,000|
|Grand Opening Cost||$5,000||$5,000|
|Additional Fund Required||$50,000||$75,000|
|Total Expected Cost||$1,442,550||$2,771,550|
That’s not it! There are several other fees and monthly charges that have to be paid in order to open a KFC franchise in USA.
Here’s a detailed overview of additional fees for starting a KFC franchise in USA:
|Royalty Fees||4%-5% of Gross Revenue|
|Audit||Complete cost of audit|
|National Co-op Fees||4.5% of Gross Revenue|
|Transfer to an Existing KFC Franchisee||$4,200 (First Outlet) & $2,100 (For additional outlet)|
|Transfer to A New KFC Franchisee||$8,400 (First Outlet) & $4,200 (For additional outlet)|
|Expenses, Costs & Attorneys’ Fees||Varies|
|Late Fee For Royalty Payments||1.5% Per Month|
|Restaurant Operations Compliance Check||Up to $282.50 Per Re-evaluation|
|Software Maintenance & Support Services||$173.15 per unit/per month|
|One System Fund Fee||$180 Per Month (Applicable Tax and Shipping Not Included)|
How To Open A KFC Franchise In USA?
KFC US LLC offers many resources and privileges to its franchise owners. In addition to traditional restaurants, which may cost up to $2,771,550, there are also non-traditional options that may proliferate opportunities in low investments.
These non-traditional KFC franchises don’t need large spaces or heavy investments. But, roughly, it needs 900 square feet of workable space in locations such as railway stations, truck stops, airports, and universities.
Here’s a step-by-step process to open a KFC franchise:
You’re going to work with a renowned and well-established business; you must be mentally prepared for it. Additionally, you must be financially stable and should have a net worth of over $1,500,000.
On the other hand, you’ll have to be prepared for all the expenses incurred in it, including the building cost, equipment costs, the cost of uniforms, the costs of licenses and permits, insurance, etc.
The most important aspect is to evaluate your previous business experience and ask yourself whether you’re mentally and financially prepared for it.
Assess Market Location & Availability
Before proceeding with your KFC franchise application, you should look out for available markets at your preferred location.
You should evaluate and examine the market and the people who often visit there. For this, you can carry out a survey and can get early hints on whether your franchise will work there or not.
Your chosen location should be near to the main market or any special attraction point, such as an amusement park. Try avoiding places that are too far away from the main city.
Submit Your Franchise Application
After going through the steps listed above; if you think your franchise will make good money, you can go forward with application submission. You can submit your application in many ways: Online and offline.
Upon submission, your application will be reviewed by the brand team, which may take up to 12 weeks to deliver any decision. The assessment includes various rounds of interviews and background checks.
And when your application moves to the next round, you’ll undergo a more thorough assessment. It includes a complete evaluation of your financial stability, your prior business experience and whether you have a “good reputation.”
In addition, the team will also review your business background, including any experience in operating a hospitality firm or a restaurant.
Upon successful application submission, you will get an email with a confirmation receipt, where you will be additionally provided with the contact information of the franchise owner.
Get Approval & Start Your KFC Franchise
Once the company is done with your financial and background checks, you will be granted approval to start a KFC franchise in USA. However, the license will be granted to applicants who meet all the requirements set by the company. The agreement will be valid for 20 years.
The process may seem to be daunting and time-taking, but once you get the approval, all your hard work will be paid off. However, your work doesn’t end here. You’ll have to set up a new team and look after their training.
How Much Does A KFC Franchise Owner Make?
Ever wondered how much a KFC outlet owner earns? To calculate how much a KFC franchise owner in the US makes, it may vary on various factors like taxes, location, size etc.
As a KFC business owner, your primary goal is to maintain the quality of service while keeping the monthly sales high and expenditure low. The probable monthly expenses may include rent/mortgage, inventory supplies, utilities, staffing/family, administrative costs vice versa.
The monthly expenditures may vary depending on the location and seasons. Generally, most franchise initial expenses are fixed, and they quickly cover start-up expenses like signage, decoration, renovations and furniture.
Is Owning A KFC Franchise In US Profitable?
Investing in any running business can prove to be profitable. And looking at the net worth of KFC, opening a KFC franchise in USA is a decision you will never regret.
According to the KFC’s Franchise Disclosure Document (FDD), a single-brand, franchise-owned KFC saw a tremendous average net sales of $1,159M in 2019. This includes 2,863 locations but excludes non-traditional, multi-brand, seasonal, or any other type of KFC establishment other than a single-brand restaurant.
Henceforth, it is clear that owning a KFC franchise in USA, whether it’s traditional or non-traditional, offers great profit opportunities.
What Are The Financing Options Available To Own KFC Franchise?
While some popular franchisors offer in-house financing, KFC provides third-party financing options. These third-party sources offer financing to cover the following expenses: franchise fee, equipment, inventory, accounts receivable, startup costs and payroll.
Owning a KFC franchise in USA is no less than an achievement as you are representing one of the world’s largest and most popular restaurants.
However, applying for a franchise of such a big company requires a good piece of market knowledge and, of course, a hefty investment.
Above, we have tried to answer every query anyone would have asked if they are planning to apply for a KFC franchise in USA. Hope! this article helped you in understanding the whole process of applying for and owning a KFC franchise in USA
The initial franchise fee for KFC is approximately $45,000. The estimated start-up costs between $1.2 million and $2.5 million, with a 5% royalty fee on gross monthly receipts.
To qualify for a KFC franchise, applicants must meet a range of assessment factors, including background checks and financial qualifications.
Yum! Brands keep their franchise owner’s salaries private. However, as an individual unit, KFC is expected to make approx $942,000 – $1,000,000 per year.
Yes, KFC offer franchise in over 150 countries, including the US, the UK and South Africa.
Investing in the KFC franchise can be a profitable move. And looking at the net worth of KFC, opening a KFC franchise is a decision you will never regret.
The most profitable franchises in the US include the names of some big restaurants like KFC, McDonald and Burger King.