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Chester's International Franchise Cost & Fees

Date of Incorporation: 2002

Franchising Since: 2004

Headquarters: Alabama

 

Country: U.S.


Description: The franchisor grant franchises for quick-service Restaurants operating under the Chester’s name that sell chicken and sides. Chester’s Restaurant offer a special selection of menu items like bone-in chicken, chicken filet, chicken filet sandwiches, chicken tenders, and an assortment of side orders like fried potatoes, vegetables, biscuits, toast, and salads.

Franchise Offer: The franchisor grants the franchisee the right to establish and operate one or more franchised Chester’s Restaurants in a specific market. The restaurant will be located in a supermarket, convenience store, or other structure like a shopping mall, food court, stadium, or strip mall. The franchisor may require the franchisee to offer a limited menu because of space restrictions or other limitations.

Financial Assistance: The franchisor does not offer direct or indirect financing nor do they guarantee any note, lease, or obligation.

Training and Assistance: Before the Restaurant opens, the franchisee and their Designated Representative must attend and satisfactorily complete the initial training program. There is 35 hours of classroom training that covers such things as food preparation procedures, restaurant management and marketing.

Territory: Under the franchise agreement the franchisee will have no territorial protection. The franchisor and their affiliates have the right at all times during the franchise term to engage in any and all activities we deem appropriate, at any time or place. The franchisor may establish other franchised, licensed, or company-owned outlets that compete with the location.

Term of Agreement and Renewal: The term of the franchise agreement is 10 years with an option to renew for an additional 5 years. The fee for renewal is $2,500.

Obligations and Restrictions: If the franchisee is a legal entity, they must designate a shareholder, member, or partner, depending on the entity, with at least a 15% ownership interest in the franchisee to be the Designated Representative, responsible for overseeing and supervising the Restaurant's overall operation. The franchisee must offer and sell all menu items and products, and perform all services that the franchisor periodically requires for Chester’s Restaurants. The franchisee may not offer or sell any menu items or products, or perform any services that the franchisor has not authorized.   

Total Number of Units: The total number of franchised units for year ending 2006: 30.

Investment Tables:


Initial Investment for In-Line store:

Name of Fee Low High
Royalties $20,000 $20,000
Insurance $3,000 $10,000
Pre-opening Salaries, Travel and Living Expenses during Initial Training $5,000 $10,000
Build-out Cost to Existing Building to Accommodate Restaurant $47,370 $96,000
Equipment, Furniture, Signage and Fixtures $87,500 $147,400
Initial Inventory $5,625 $9,000
Grand Opening Advertising $1,000 $4,000
Utility Deposits, Fees and Business Licenses $1,200 $5,000
Additional Funds (3 months) $15,000 $40,000
Total (excluding real estate lease and purchase costs) $185,695 $414,400

 

Ongoing Fees:

Name of Fee Amount
Royalty 4% of Gross Sales
Marketing promotions Fund Up to 1% of Restaurant’s monthly gross sales
Local Marketing Expenditure 3% of gross monthly sales
Cooperative Advertising Program 3% of gross sales
Additional training and Assistance Not to exceed $50 per day plus out-of-pocket expenses
Transfer $3,000 per restaurant
Renewal Franchise $2,500
Late Fee 10% of original amount due but not paid on time
Interest 1½% per month or highest commercial contract interest rate law allows, whichever is less
Indemnification Will vary under circumstances
Attorneys’ Fees Will vary under circumstances
 Testing  Cost of testing
 Computer Systems, Maintenance and Support  Cost of service
 Audit  Cost of inspection or audit

Year of FDD: 2008

The above information has been taken from the UFOC/FDD of Chester's International.

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