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Arby's Franchise Cost & Fees

Date of Incorporation: 1964
Franchising Since: 1965
Headquarters: Atlanta, Georgia

Business Description: Arby's menu features roasted beef sandwiches. In addition to its signature roast beef, the Arby’s menu contains a variety of high-quality proteins including turkey, chicken, steak, bacon, ham, and corned beef that are crafted into deli-inspired sandwiches. Arby’s Restaurants also offer a number of sides such as curly fries, shakes, turnovers, and other add-ons. Arby’s Restaurants also may offer breakfast items as an option from its approved menu.

Franchise Offer: The franchisee will operate a restaurant under the name Arby's and featuring Arby's Roast Beef sandwiches. There are two franchise offerings:

  1. Traditional: full-menu, limited service Arby’s Restaurants, which are either freestanding, convenience stores, travel plazas, truck stops, travel plaza/convenience store combos, end cap and inline locations, and malls.
  2. Non-traditional: limited menu, limited size and reduced service restaurants, which generally occupy a smaller retail space, offers no or very limited seating and may cater to a captive audience, may have a limited menu and may possibly feature reduced services, labor, storage and different hours of operation. Non-Traditional Arby’s Restaurant categories include but are not limited to locations in airports, military bases, hospitals, toll plazas, stadiums, theme/amusement parks and arenas which have no seating or shared seating, casinos, colleges, universities, and other institutional type facilities which have common area seating.

Financial Assistance:The franchisor and their affiliates do not offer direct or indirect financing for new Arby's businesses. The franchisor does not guaranty the franchisee’s note, lease, or any other obligation. The franchisor does not receive any payments from any third-party financing institutions to which franchisees might be referred for potential financing assistance. The franchisor does have an agreement with Element Financial Corp. relating to financing that Element will provide to qualified franchisees who are remodeling their Arby’s Restaurants.

Training and Assistance: If the franchisee is new, the franchisor requires him or her to participate in New Franchisee Orientation (NFO). The NFO is a one to two day-long orientation program. There is no cost for the program; however, the franchisee will pay his or her own travel, meal, and lodging expenses. If the franchisee is a partnership or corporation, then the franchisor requires that a partner or approved shareholder participate in NFO. The NFO is a brief overview of the Arby's system and the administrative corporate support provided. For the franchisee’s first and second Restaurants, he or she must at all times employ three managers (six total) who have completed (to Arby's satisfaction) and are certified in the Arby's Restaurant Management Training Program (MTP). The current MTP runs for seven weeks at a Nationally Certified Training Restaurant. In addition to the NFO and the MTP, the franchisor utilizes the Revitalization Roadmap to ensure successful executions for new Restaurants openings, for the first and second Restaurants opened by a franchisee. For the first Restaurant opened, the training includes the services of two people to assist with the needed pre-opening and post-opening crew training at the Licensed Premises for 10 calendar days. For the second Restaurant opened, the training includes the services of one person to assist with the needed pre-opening and post-opening crew training at the Licensed Premises for six calendar days. The franchisor reserves the right, in its sole judgment, to specify additional training requirements, including, but not limited to, supplemental or refresher training programs for franchisees, their managers and/or employees.

Territory: Each Traditional Arby’s Restaurant License Agreement will authorize the franchisee to operate one Arby's Restaurant at a specified location referred to as the “Licensed Premises.” The franchisor may, in its sole judgment, grant the franchisee a specific and limited protected area surrounding the Restaurant (the “Protected Area”). The franchisor will not operate or license others to operate an Arby's Restaurant within the Protected Area, if any, during the term of the License Agreement using the licensed Trademarks and offering roast beef sandwiches for sale to consumers. Each Non-Traditional Arby’s Restaurant License Agreement will authorize the franchisee to operate one Arby's Restaurant at the Licensed Premises. The franchisee will not receive a Protected Area that extends beyond the Licensed Premises.

Term of Agreement and Renewal: The initial term of the franchise for a traditional restaurant is up to 20 years, but may be less if the franchisee’s lease is shorter than 20 years or the franchisee purchased an existing company-owned Restaurant and the franchisor does not own the property; or purchase an existing franchisee’s Restaurant, in which case, the franchisee will either receive the balance of the term under the existing agreement or a 20-year term. For non-traditional restaurants, the initial term is equal to the shorter of 10 years or the term of the lease with the applicable airport authority, stadium or arena, or length of the lease for the Licensed Premises. If the franchisee is in good standing and meets approval criteria, he or she may receive a new License Agreement (which may have materially different terms and conditions than your previous License Agreement).

Obligations and Restrictions: The franchisee must at all times faithfully, honestly, and diligently perform their obligations under the Arby's License Agreement, continuously exert their best efforts to promote and enhance the Arby's restaurant, and not engage in any other business or activity that conflicts with their obligations to operate the Arby's restaurant in compliance with the Arby's License Agreement. The franchisee may only sell those food and non-alcoholic beverage products designated in the Manual as being included in the standard Arby's menu and meeting the quality standards (including product specifications and sources, cleanliness and sanitation, customer service and hours of operation) in the Manual or as otherwise designated in writing.

Estimated Number of Units: 3,400

Investment Tables:
Initial Investment for a Freestanding 2000 Sq. Ft Restaurant - Leased Site Costs
Name of Fee Low High
Development Fee $5,000 $10,000
License Fee $0 $25,000
Travel and Living Expenses while Training $5,000 $23,000
Real Property/Occupancy Charge Varies
Site Costs $1,000 $4,500
Landscaping $20,000 $38,000
Civil & Architectural Drawings/ Professional Fees $5,000 $25,000
Building Costs $1,000 $174,000
Equipment $160,000 $222,000
Computer Hardware and Software/POS System $25,000 $50,000
Décor Package $32,000 $59,000
Signage & Drive Thru $38,000 $64,000
Pre-Opening Wages $17,700 $34,000
Opening Inventory $14,000 $28,000
Insurance $7,000 $12,000
Working Capital/Additional Funds $1,000 $50,000
Lease Deposits and Payments Variable
Business Licenses, Health Permits, Utilities Deposits $1,000 $25,000
ESTIMATED TOTAL $332,700 $843,500
Initial Investment for a Freestanding 2000 Sq. Ft Restaurant - Purchased Site Costs
Name of Fee Low High
Development Fee $5,000 $10,000
License Fee $0 $25,000
Travel and Living Expenses while Training $5,000 $23,000
Real Property/Occupancy Charge Varies
Site Costs $138,000 $213,000
Landscaping $20,000 $38,000
Civil & Architectural Drawings/ Professional Fees $16,000 $47,000
Building Costs $419,000 $580,000
Equipment $160,000 $222,000
Computer Hardware and Software/POS System $25,000 $50,000
Décor Package $32,000 $59,000
Signage & Drive Thru $38,000 $64,000
Pre-Opening Wages $17,700 $34,000
Opening Inventory $14,000 $28,000
Insurance $7,000 $12,000
Working Capital/Additional Funds $1,000 $50,000
Lease Deposits and Payments Variable
Business Licenses, Health Permits, Utilities Deposits $1,000 $25,000
ESTIMATED TOTAL $904,700 $1,565,500
Initial Investment for a Non-Freestanding Restaurant – Leased Site Costs
Name of Fee Low High
Development Fee $5,000 $10,000
License Fee $0 $25,000
Travel and Living Expenses while Training $5,000 $23,000
Real Property/Occupancy Charge Varies
Site Costs $10,000 $65,000
Civil & Architectural Drawings/ Professional Fees $5,000 $40,000
Building Costs $1,000 $337,000
Equipment $151,000 $217,000
Computer Hardware and Software/POS System $25,000 $50,000
Décor Package $29,000 $53,000
Signage & Drive Thru $9,000 $41,000
Pre-Opening Wages $17,700 $34,000
Opening Inventory $14,000 $28,000
Insurance $7,000 $12,000
Working Capital/Additional Funds $1,000 $50,000
Lease Deposits and Payments Variable
Business Licenses, Health Permits, Utilities Deposits $1,000 $25,000
ESTIMATED TOTAL $272,700 $1,025,500
Other Fees for a Traditional Arby's Restaurant
Type of Fee Amount
Royalty 4% of total gross sales.
Advertising Marketing Service Fee A percentage of monthly Gross Sales, with a current minimum of 4.2% aggregate including this fee, Local Advertising, and Cooperative Advertising (if applicable).
Local Market Advertising A percentage of monthly Gross Sales, with a current minimum of 4.2% aggregate including this fee, the Advertising and Marketing Service Fee, and Cooperative Advertising (if applicable).
Local Cooperative Area Advertising A percentage of monthly Gross Sales, with a current minimum of 4.2% aggregate including this fee, the Advertising and Marketing Service Fee, and Local Advertising.
Membership in ARCOP, Inc. $100 Initial fee per franchisee/Upcharge on key food items (currently cases of French fry products, roast beef, and some frozen bread).
Renewal Fees 10% of the then applicable standard license fee (excluding the impact of any discounts or promotions, including any development incentive programs that may be available).
Transfer Fee (Ownership) $17,500 for transfer of first Arby's restaurant; $2,500 if franchisee is already a 50% owner of at least one existing License Agreement.
Training Fee $1,700 per attendee. However, there is no training fee for three managers in the first Restaurant, and for one manager in the second Restaurant. Franchisees pay the training fee for all their other attendees, and they pay their trainees' expenses.
Additional Training The fee ranges from $0 to $1,700. Franchisees pay for their trainees' expenses.
Audits Interest on the deficiency. If deficiency is more than 3% of actual Gross Sales, franchisee must pay interest plus audit expenses.
Testing of Samples for Approval Cost of samples.
Approval of Suppliers Costs and expenses incurred, which may range from $2,500 to $10,000.
Interest Up to the highest rate permitted by the law of the State in which the licensed business is located or the laws of the State of Georgia, whichever is higher, but in no event to exceed 18% per year.
Costs and Attorney Fees Will vary under circumstances.
Taxes, Assessments, Penalties, Interests and Additional Charges As assessed.
Indemnity and Insurance Insurance Carrier sets the premium
Other Fees for a Non-Traditional Restaurant
Type of Fee Amount
Royalty 6.2% of monthly Gross Sales.
Advertising Marketing Service Fee Franchisor pays the Advertising and Marketing Service Fee from the royalty, and franchisees will not incur this as an additional fee.
Local Market Advertising Franchisee pays nothing in addition to royalties.
Local Cooperative Area Advertising Franchisee pays nothing in addition to royalties.
Membership in ARCOP, Inc. (ARCOP) $100 Initial fee per franchisee/Upcharge on key food items (currently cases of French fry products, roast beef, and some frozen bread).
Renewal Fees The then applicable License Fee (excluding the impact of any discounts or promotions, including any development incentive programs that may be available).
Transfer Fee (Ownership) $17,500 for transfer of first Arby's Restaurant; $2,500 if franchisee is already a 50% owner of at least one existing License Agreement.
Training $1,700 per attendee. However, there is no training fee for three managers in the first Restaurant, and one manager in the second Restaurant. Franchisee pays the training fee for all other attendees, and trainees' expenses.
Additional Training The fee ranges from $0 to $1,700. Franchisee pays for trainees' expenses.
Audits If audit shows any deficiency, the franchisee must pay interest on the deficiency. If deficiency is more than 3% of actual Gross Sales, the franchisee must pay interest plus the franchisor’s audit expenses.
Testing of Samples for Approval Cost of samples.
Approval of Suppliers Costs and expenses incurred, which generally range from $2,500 to $10,000.
Repairs, Maintenance and Remodeling As assessed.
Interest Up to the highest rate permitted by the law of the State in which the Licensed Business is located or the laws of the State of Georgia, whichever is higher, but not to exceed 18% per year.
Costs and Attorney Fees Will vary under circumstances.
Taxes, Assessments, Penalties, Interests and Additional Charges As assessed.
Indemnity and Insurance Insurance carrier sets the premium.

The above information has been taken from the FDD of Arby's. Year of FDD: 2016

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