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El Pollo Loco Franchise Cost & Fees

Date Incorporation: 1989

Franchising Since: 1980

Headquarters: Costa Mesa, California

Description: EI Pollo Loco franchisees operate quick-service restaurants that offer and serve flame-grilled food items and related products and services, featuring Mexican-style flame-broiled chicken.

Franchise Offer: El Pollo Loco is offering to types of franchises; a single restaurant or multiple restaurants under a development agreement.

Financial Assistance: The franchisor does not offer any direct or indirect financing nor do they guarantee any note, lease or obligation. The franchisor may occasionally attempt to identify lenders willing to extend financing to the franchisee.

Training and Assistance: If the restaurant is either the franchisee's first or second El Pollo Loco restaurant, the franchisor will provide initial training to the franchisee, their operations director and a minimum four of their managers. The initial training for a general manager consists of 40 days over an eight-week period. The initial training for an assistant manager consists of 35 days over a seven-week period. The initial training for the executive franchisee training program consists of 10 business days typically over a continuous two-week period. The program consists of hands-on training in the operation and management of the restaurant.

Territory: The franchisee will not receive an exclusive territory under the franchise agreement.

Term of Agreement and Renewal: The term of the franchise agreement is 20 years and can be renewed for a 10-year successor franchise, under certain conditions.

Obligations and Restrictions: The franchisee must participate personally in the direct operation of the El Pollo Loco restaurant. The franchisor rthe franchisees direct on-premises supervision to promote restaurant performance. El Pollo Loco restaurant shall be managed by not less than 4 managers who have successfully completed the El Pollo Loco management training program  approved food items may be sold in the restaurant. The franchisee must offer at the restaurant all those products and services required by the franchisor, including those items specified in the standard El Pollo Loco menu, plus specials and featured items designated.

Total Number of Units: 413 units by year end 2008

Total Number of franchises Units: 248 franchised units by year end 2008

Investment Tables:

Initial Investment:

Expenditures Low High
Franchise fee $40,000 $40,000
Lease payment $3,350 $13,350
Architectural design $15,000 $65,000
Equipment, fixtures and furnishings $275,000 $425,000
Computer-based cash control system and restaurant management or “point of sale system”, point of sale equipment $20,000 $40,000
Signs $6,000 $50,000
Expenses for initial training $10,000 $20,000
Opening inventory and supplies $9,000 $12,50
Lease security deposits $5,000 $10,000
Insurance $3,000 $6,000
Grand opening fee $5,000 $5,000
Additional funds (3 months) $25,000 $100,000
Site selection costs (if the franchisor visited more than 2 sites) $500 $3,000
Total (exclusive of real estate, site improvements and building costs) $416,850 $789,850

 

Ongoing fees:

Name of Fee Amount
Royalty fee 4% of monthly gross sales
Advertising 4-5% of monthly gross sales
Reimbursement for taxes, products, services and other payment Actual cost
Computer systems maintenance and support Varies
Intranet fee Reasonable cost up to $1,000 annually per restauran
Franchise page fee (on Internet) Reasonable cost up to $1,000 annually per restaurant
Customer feedback program Varies
Catering program catering orders through 888-EPL-ToGo $5.00 each
Gift card Varies
Broker fees 3-5% of lease value

 

The above information has been taken from the UFOC/FDD of El Pollo Loco

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