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Popeyes Louisiana Kitchen Franchise Cost & Fees

Date of Incorporation: 1972
Franchising Since: 1976
Headquarters: Atlanta, Georgia

Business Description: Popeyes Louisiana Kitchen, Inc. is the franchisor. Popeyes Restaurants are quick service restaurants offering a limited menu of lunch and dinner products, and in certain Restaurants approved by the franchisor, breakfast products. Popeyes distinguishes itself with a unique “Louisiana” style menu that features spicy chicken, chicken tenders, biscuits, fried shrimp and other seafood, red beans and rice and other quick-service menu items.

Franchise Offer: Franchisees will operate a quick-service restaurant specializing in the sale of fried chicken, seafood and other quick service food under the name “Popeyes Louisiana Kitchen.”

Financial Assistance: The franchisor does not offer direct or indirect financing. The franchisor does not guarantee the franchisee’s notes, leases or other obligations.

Training and Assistance: Franchisees must complete, to the franchisor’s satisfaction, the Popeyes New Franchisee Orientation Program before opening or taking possession of their first Restaurant. Before opening the Restaurant, a minimum of 4 designated management employees (the franchisor will decide the final number), including the Operating Principal for the Restaurant, must attend and complete, to the franchisor’s satisfaction, the Popeyes Management Certification (PMC) Program, which consists of online training and in-restaurant operations training at a facility designated by the franchisor. The PMC Program includes production and service training, production management, service management and shift management modules. The PMC Program can last as long as 6 to 10 weeks. Periodically, the franchisor also may make available to franchisees or their employees additional training programs that the franchisor, in its discretion, choose to conduct. Attendance at these training programs may be mandatory.

Territory: Franchisees will be granted a geographic area within which the franchisor will not open, nor license anyone other than the franchisee to open, a Popeyes Restaurant during the term of the Franchise Agreement. The Protected Area will consist of an area equal to the lesser of: (1) a 1 mile radius around the Restaurant; or (2) an area surrounding the Restaurant encompassing a population (residential and/or daytime/commercial) of 50,000 people. The limited exclusivity granted in the Protected Area does not apply to: (a) existing Restaurants, (b) any closed Restaurants that may re-open within three years from the closing date of such restaurant; and (c) Restaurants for which Franchise Agreements were previously granted. The franchisor has the right periodically to reduce or modify the Protected Area to reflect population shifts. The franchisee will not receive an exclusive territory under the Franchise Agreement. The franchisee may face competition from other Popeyes Restaurants that are franchised or owned.

Term of Agreement and Renewal: The length of the initial franchise term is 20 years from the date of commencement of operation of the Restaurant. One renewal term of 10 years, subject to contractual requirements, and an option to purchase up to 1 additional 10 year “Supplemental Renewal Term” is available.

Obligations and Restrictions: If more than one individual or a legal entity such as a corporation, partnership or limited liability company owns the Franchise, the franchisee must designate and retain an individual to serve as the Operating Principal of the Restaurant. The Operating Principal must be approved by Popeyes and must have at least a 5% ownership interest in the franchisee or the right to receive 5% or more of the operating profits of the Restaurant. In addition, the Restaurant must at all times be under the direct, on-premises supervision of a PMC Certified Manager whom the franchisee designates to have primary responsibility for its operation. Franchisees must use the Restaurant solely for the operation of a Popeyes Restaurant and must keep the Restaurant open and in normal operation for the hours and days as specified in the Manual or otherwise in writing. Franchisees must meet and maintain the highest applicable health standard and rating. Franchisees must operate the Restaurant in strict conformity with the methods, standards and specifications as prescribed in the Manual or otherwise in writing. Franchisees must offer for sale and sell at the Restaurant all and only those products and services as are expressly authorized by the franchisor in the Manual or otherwise in writing. Franchisees may offer products and menu items for sale at whatever price they want.

Estimated Number of Units: 2,420

Investment Tables:
Initial Investment for a Free Standing Restaurant
Name of Fee Low High
Development Fee $12,500 $12,500
Initial Franchise Fee $35,000 $35,000
Real Estate and Improvements Variable
Soft Costs $33,392 $101,721
Site Work $153,075 $419,412
Building $417,376 $593,844
FF&E Signage and Technology $239,172 $384,586
Initial Training $15,200 $22,200
Opening Supplies $10,000 $20,000
Insurance $9,000 $18,000
Utility Deposits $3,000 $50,000
Business licenses $300 $600
Additional Funds (3 months) $20,000 $30,000
ESTIMATED TOTAL INVESTMENT $948,015 $1,687,863
Initial Investment for an In-Line Restaurant
Name of Fee Low High
Development Fee $12,500 $12,500
Initial Franchise Fee $35,000 $35,000
Real Estate and Improvements Variable
Soft Costs $7,840 $37,500
Building $250,000 $413,388
FF&E Signage and Technology $242,000 $320,019
Initial Training $15,200 $22,200
Opening Supplies $10,000 $20,000
Insurance $9,000 $18,000
Utility Deposits $2,500 $5,000
Business licenses $300 $600
Additional Funds (3 months) $20,000 $30,000
ESTIMATED TOTAL INVESTMENT $604,340 $914,207
Initial Investment for a Conversion Restaurant
Name of Fee Low High
Development Fee $12,500 $12,500
Initial Franchise Fee $35,000 $35,000
Real Estate and Improvements Variable
Soft Costs $25,449 $116,345
Site Work $0 $174,712
Building $312,613 $378,524
FF&E Signage and Technology $255,195 $329,835
Initial Training $15,200 $22,200
Opening Supplies $10,000 $20,000
Insurance $9,000 $18,000
Utility Deposits $2,500 $5,000
Business licenses $300 $600
Additional Funds (3 months) $20,000 $30,000
ESTIMATED TOTAL INVESTMENT $697,757 $1,142,716
Other Fees
Type of Fee Amount
Royalty 5% of gross sales.
Advertising Fund Contribution 4% of gross sales.
Advertising Co-op As established by Local Advertising Co-op (in addition to Advertising Fund Contribution).
Audit Cost of audit.
Costs and Attorneys’ Fees Franchisor’s costs and expenses.
Development Schedule Extension Fee Up to $5,000 for each Development Schedule Extension.
Indemnity The losses and expenses the franchisor incurs.
Insurance Cost of obtaining coverage plus interest and a reasonable administrative fee that the franchisor will set.
Interest on Overdue Payments 1.5% per month or the maximum rate permitted by law, whichever is less.
Interest on Understated Sales 1.5% per month or the maximum rate permitted by law, whichever is less.
Returned Payment Fee $35 per returned payment.
Product Testing Cost of testing new products.
Renewal 50% of the then current, standard initial franchise fee.
Securities Offering Review Fee $5,000 or a greater amount, if necessary, to reimburse the franchisor for its out-of-pocket costs and expenses in connection with reviewing the proposed securities offering.
Site Visit Fee $1,500 per site visit.
Supplemental Term Option 50% of our then current, standard, initial franchise fee.
Trade Secret Products Approximately $3,000 initially; approximately $3,000 per month when in operation.
Transfer $7,500
Impact Study $6,000 per study.
Non-Solicitation of Employees $5,000 per occurrence.

The above information has been taken from the FDD of Popeyes Louisiana Kitchen. Year of FDD: 2016

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