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Chick-Fil-A Operator Income
Posted on 3/20/17 at 12:03 pm
Posted on 3/20/17 at 12:03 pm
I've seen and heard wildly different accounts of how much the operators of Chick-Fil-A franchise makes per year. Any of you have personal or otherwise reliable insight on the average for the operator for a single standalone Chick-Fil-A?
I would say the "consensus" I've heard is in the $200k range but I think that information may be a little dated and I'm wondering if it's a bit higher than that now. I realize that there is probably a wide range based on location/volume but trying to get an idea of what the average store/operator would look like.
I would say the "consensus" I've heard is in the $200k range but I think that information may be a little dated and I'm wondering if it's a bit higher than that now. I realize that there is probably a wide range based on location/volume but trying to get an idea of what the average store/operator would look like.
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Posted on 3/20/17 at 12:15 pm to elposter
The one by me off 59 has 2 drive thru lines packed all day, I'd say $200k a month wouldn't be out of the question
Posted on 3/20/17 at 12:20 pm to dabigfella
I would think that operators that are doing well already have their eyes on any areas to put more locations.
Posted on 3/20/17 at 12:23 pm to dabigfella
You saying the owner/operator is pulling down $2.4M a year? Or the store is doing $2.4M profits?
No operator of a single fast food restaurant location is making $2.4M.
No operator of a single fast food restaurant location is making $2.4M.
Posted on 3/20/17 at 12:36 pm to dabigfella
quote:
The one by me off 59 has 2 drive thru lines packed all day, I'd say $200k a month wouldn't be out of the question
In store revenue sure. But no operator is bringing home 200k a month for one location which is what I'm talking about. I think the average revenue per store is around $3 million in revenue. That's why I'm thinking the $200k average operator net income/profit that I've heard seems kind of low. Just not sure what the margin is for a $3 million dollar/year revenue Chick-Fil-A for the individual operator?
Posted on 3/20/17 at 12:36 pm to elposter
100k per year.
The Chik takes a huge cut from sales. 65% to be exact.
The Chik takes a huge cut from sales. 65% to be exact.
Posted on 3/20/17 at 12:39 pm to achenator
quote:
I would think that operators that are doing well already have their eyes on any areas to put more locations.
My understanding is Chick-Fil-A has pretty tight reins on decisions about where to put locations (decisions pretty much made exclusively by Chick-Fil-A corporate, not individual operators) and also tightly restricts the number of stores any one operator can have. I think it is uncommon to have more than one and very rare to have more than two, if that is even allowed. I also don't think Chick-Fil-A operators can really be considered owners like other franchisees can. I don't think they really own much of anything about the store.
Posted on 3/20/17 at 12:41 pm to elposter
$200,000 doesn't seem outrageous to me, especially for how high volume most Chikfila locations are.
Posted on 3/20/17 at 12:46 pm to SippyCup
quote:
The Chik takes a huge cut from sales. 65% to be exact.
That's a lot. I saw that Chick-Fil-A's average sales per restaurant in 2015 was $3.9 million. If the 65% number is correct that leaves the operator with $1,365,000 gross sales - minus whatever expenses he has = personal income. Not sure what the division of costs is between corporate and individual operator. I imagine all labor and food costs belong to the operator, but I wonder about the real estate, marketing, etc type costs.
quote:
100k per year.
I would be shocked if the average is that low. Is that just a guess or do you some information that supports that?
This post was edited on 3/20/17 at 2:26 pm
Posted on 3/20/17 at 12:50 pm to tiger rag 93
Yeah. If I were investing in a franchise I'd expect $200k or more per location to make it worth the investment.
Posted on 3/20/17 at 12:50 pm to elposter
quote:
I imagine all labor and food costs belong to the operator, but I wonder about the real estate, marketing, etc type costs.
Chik-Fila-A builds the facility and provides all the equipment for a rental fee of 15% of gross sales. They then take 50% of the remaining gross sales.
Owners are discouraged from operating more than one franchise.
quote:
I would be shocked if the average is that low. Is that just a guess or do you some information that supports that?
I know, a former client owned part of a franchise. I was surprised as well until I learned of the royalty percentage.
Its actually not bad when you consider you really have no major upfront costs. The franchise fee is one of the lowest in the industry.
This post was edited on 3/20/17 at 12:53 pm
Posted on 3/20/17 at 12:56 pm to SippyCup
That and you have to be accepted into the cult of CFA. CFA is not for people looking to get rich.
Posted on 3/20/17 at 1:09 pm to SippyCup
quote:
The franchise fee is one of the lowest in the industry.
200K annually on an initial investment of 5,000.....
Pretty good I'd say. I'd say over time, you should definitely meet almost any definition of "rich"
Posted on 3/20/17 at 1:24 pm to AUjim
quote:
200K annually on an initial investment of 5,000.....
Pretty good I'd say. I'd say over time, you should definitely meet almost any definition of "rich"
Yeah but the path to that is a long one.
I have a friend that just became an operator. He got out of college then spent the next 5 years (or more) it seems moving from location to location during the training process
that doesn't even include the fact that they only accept a very small number of franchise owners
Posted on 3/20/17 at 1:25 pm to tiger rag 93
quote:
You saying the owner/operator is pulling down $2.4M a year? Or the store is doing $2.4M profits?
No operator of a single fast food restaurant location is making $2.4M.
LOL you clearly know nothing about small businesses and potential profits. I have a a truck stop that's a cash cow and does almost $20m/year in sales. Yes gas margins aren't high, but inside sales + slots + lottery have made me an income you wouldn't believe.....from 1 location. I have a few others who don't do nearly as well but nobody is investing $2-3M in a fast food/grocery location without making alot more than you think.
Posted on 3/20/17 at 1:31 pm to dabigfella
My dad is a fast food restaurant owner/operator...I have some knowledge on subject.
I would guess there is almost no person who makes $2.4M in personal profit from a SINGLE fast food restaurant. Yes, there are operators who own multiple restaurants who probably make that much. But not off of one location.
Also, you referenced a truck stop that makes 20M a year. A good Chikfila will make $4M a year. Little different scenarios and comparing apples to oranges, really.
I would guess there is almost no person who makes $2.4M in personal profit from a SINGLE fast food restaurant. Yes, there are operators who own multiple restaurants who probably make that much. But not off of one location.
Also, you referenced a truck stop that makes 20M a year. A good Chikfila will make $4M a year. Little different scenarios and comparing apples to oranges, really.
This post was edited on 3/20/17 at 1:34 pm
Posted on 3/20/17 at 1:34 pm to dabigfella
quote:
LOL you clearly know nothing about small businesses and potential profits. I have a a truck stop that's a cash cow and does almost $20m/year in sales. Yes gas margins aren't high, but inside sales + slots + lottery have made me an income you wouldn't believe.....from 1 location. I have a few others who don't do nearly as well but nobody is investing $2-3M in a fast food/grocery location without making alot more than you think.
We are talking about fast food restaurants though. And Chick-Fil-A in particular. We know that actual cash investment is only $5000. We also know that the average revenue (in 2015) is $3.9 million and that 65% goes to corporate leaving gross revenue of about $1.75 million from which the operator has subtract all its costs (labor, food, etc.). What we are trying to figure out is what the operator makes on average after all of the operating expenses and corporate takes its cut.
This post was edited on 3/20/17 at 1:41 pm
Posted on 3/20/17 at 1:34 pm to tiger rag 93
That's great that your dad is a fast food operator. Im a convenience store operator so I have stores that fast food included. I have one with a subway and a burger king. I know stores that do net $2M+ annually. You ever see the massive truck stops? Those all net that, the margins on inside sales are 50% they easily do $250/k month in inside sales on a large freeway. They sell a ton of water which cost .10 2 for $1 whats the margin on that? They have an attached fast food place that does $100-200k in sales, whats the net on that? What's the net on their slots? 30% typically.
Im not sure what your dad owns but I own 5 stores and I know what these stores make.
Im not sure what your dad owns but I own 5 stores and I know what these stores make.
This post was edited on 3/20/17 at 1:36 pm
Posted on 3/20/17 at 1:38 pm to dabigfella
No where in this thread was anybody talking about truck stops lol.
I'm not saying you're wrong. You're just comparing two different things.
I'm not saying you're wrong. You're just comparing two different things.
Posted on 3/20/17 at 1:43 pm to elposter
quote:
We are talking about fast food restaurants though. And Chick-Fil-A in particular. We know that actual cash investment is only $5000. We also know that the average revenue (in 2015) is $3.9 million and that 65% goes to corporate. What we are trying to figure out is what the operator makes on average after all of the operating expenses and corporate takes its cut.
Well I'm telling you I have a store with 2 fast food places, a burger king and a subway, that gross $5M combined annually, so I dont think its insane that the chick fil a near my home in houston between buffalo speedway & Kirby with 2 drive thru lines packed all day long nets $200k/mo which is just $6k/day. They have a huge store inside + like I said 2 drive thru lines outside that are always packed. The margins on things like fountain drinks are disgusting especially now with the freestyle machine. You could sell in 17 hours lets say 1000 soft drinks and net $1500/day in a place like that alone without the food or anything else.
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