Hardee's
Date Incorporation: 1960
Franchising Since: 1961
Headquarters: St. Louis, Missouri
Description: Hardee's restaurants are quick service restaurants offering a limited menu of breakfast, lunch and dinner products. The restaurants feature charbroiled Thickburger sandwiches, chicken, specialty sandwiches, biscuits and other breakfast items and other related fast-food service menu items.
Dual concept restaurants are quick service Hardee's restaurants that also incorporate the Red Burrito dual concept system. In addition to Hardee's breakfast, lunch and dinner products, dual concept restaurants offer certain Red Burrito Mexican food products.
Franchise Offer: Hardee's Food Systems Inc.is offering the opportunity to purchase a franchise to operate one or more Hardee's restaurants or dual concept restaurants. The franchisee will operate a quick service restaurant under the name "Hardee's" or a quick service restaurant under the names "Hardee's" and "Red Burrito", a dual concept restaurant. Hardee's Food Systems is also selling certain company-operated restaurants to qualified current and prospective franchisees for operation as franchised Hardee's restaurants and dual concept restaurants.
Financial Assistance: Hardee's Food Systems does not offer any direct or indirect financing.
Training and Assistance: The franchisor will provide the training program to at least four individuals. For dual concept restaurants, they will also provide the Red Burrito training program to designated employees. The franchisor also provides the franchisee with any development training required. The minimum length of the training course is 9 consecutive weeks; however, depending on the prior experience of the franchisee the training course could last as long as 12 weeks. The franchisor will provide the franchisee with assistance, upon request, in opening the franchised restaurant and in training employees in light of the franchisee's needs and the availability of personnel.
The franchisor will provide additional training to the franchisee and any other employees designated by the franchisor, if they decide to offer any additional training.
Territory: Under the franchise agreement, the franchisee will be licensed to develop and operate a franchised restaurant at a designated location. If the franchisee complies with the commitment agreement and franchise agreement, Hardee's Food Systems will not operate or license others to operate a Hardee's restaurant and/or a Carl's Jr. restaurant and/or a fast service restaurant that sells hamburgers or any food menu item that comprises at least 10% of sales at Hardee's restaurants operated by Hardee’s Food Systems within a radius of 1 ½ miles of the franchised location during the term of each agreement.
Term of Agreement and Renewal: The term of the franchise agreement (Hardee's restaurant or dual concept) is 20 years and can be renewed for either 10 years or 5 years at the franchisee's option.
Obligations and Restrictions: The franchisee is not obligated to participate personally in the direct operation of the franchised restaurant, although their personal participation is encouraged. The franchisee must designate a qualified individual to serve as the operating principal of the franchised restaurant. The franchisee must offer for sale and sell at the franchised restaurant all and only those products and services as are expressly authorized by the franchisor. For dual concept restaurants, the franchised restaurant, at all times, also must offer and sell the Red Burrito food products specified by Hardee's Food Systems.
Total Number of Units: More than 1,900 units worldwide
Investment Tables:
Hardee's restaurant
| Expenditures | Low | High |
|---|---|---|
| Initial franchise fee | $10,000 | $35,000 |
| Real property | Varies | |
| Building and site improvements | $700,000 | $900,000 |
| Equipment and signage | $325,000 | $445,000 |
| Initial training | $3,800 | $10,000 |
| Pre-opening costs | $57,000 | $87,500 |
| Additional funds (3 months) | $0 | $20,000 |
| Total | $1,095,800 | $1,497,500 |
Dual concept restaurant
| Expenditures | Low | High |
|---|---|---|
| Initial franchise fee | $15,000 | $47,500 |
| Real property | Varies | |
| Building and site improvements | $700,000 | $900,000 |
| Equipment and signage | $325,000 | $495,000 |
| Initial training | $3,800 | $10,000 |
| Pre-opening costs | $59,500 | $90,200 |
| Additional funds (3 months) | $0 | $20,000 |
| Total | $1,153,300 | $1,562,700 |
Conversion of existing Hardee's restaurant to dual concept restaurant
| Expenditures | Low | High |
|---|---|---|
| Initial franchise fee | $5,000 | $12,500 |
| Real property | Varies | |
| Construction improvements | $10,000 | $35,000 |
| Equipment | $40,000 | $70,000 |
| Signage (exterior only) | $25,000 | $50,000 |
| Miscellaneous opening costs | $3,800 | $4,600 |
| Opening inventory | $2,500 | $2,700 |
| Additional funds (3 months) | Varies | |
| Total | $86,300 | $174,800 |
Ongoing fees:
| Name of Fee | Amount |
|---|---|
| Royalty fee | 3.5% of gross sales for the first 5 years and 4% of gross sales for the balance of the initial term, for newly-developed franchised restaurants; 4% of gross sales for all other franchised restaurants |
| Hardee's advertising and promotional obligation | 5% of Hardee's gross sales as a maximum |
| Hardee's national advertising fund | Currently 0.8% of Hardee's gross sales ($850 per restaurant maximum; $475 per restaurant minimum) |
| Hardee's regional cooperative | Amount determined by regional co-op |
| Hardee's local store marketing | Difference between advertising and promotional obligation and the amount contributed to Hardee's national advertising fund and a regional co-op |
| Red Burrito advertising (if applicable) | Currently, 1% of Red Burrito gross sales |
| Red Burrito production fund (if applicable) | Currently, 1% of Red Burrito gross sales |
| Red Burrito regional advertising (if applicable) | Varies |
| Red Burrito regional cooperative (if applicable) | Amount determined by Red Burrito regional co-op |
| Red Burrito LSM (if applicable) | Difference between Red Burrito APO and the amount contributed to Red Burrito production fund and Red Burrito regional fund or co-op |
| Point of purchase advertising materials | $2,000 - $3,000 per year |
| Travel, living and other expenses while training | Amount determined by Hardee's Food Systems |
| Additional training material (optional) | Varies |
| Software licence fee | Currently $130 per fiscal period |
| Renewal fee | $5,000 for a 5-year renewal term (or less) or $10,000 for a renewal term greater than 5 years, but no more than 10 years |
Date of FDD: 2009
The above information has been compiled from the FDD of Hardee’s along with online sources.
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