Franchising Since: 1987
Headquarters: Atlanta, Georgia
Estimated Number of Units: 3,100
Franchise Description: The franchisor is Chick-fil-A, Inc. Franchisees (often referred to as operators) will operate a franchised Chick-fil-A restaurant business, which is a limited-menu, quick-service restaurant with its primary product being a boneless breast of chicken sandwich. Chick-fil-A restaurants are established in free-standing locations as well as in non-free-standing locations, including mall and in-line units, locations which are drive through only and non-traditional locations where Chick-fil-A has direct access to the owners or managers of the location premises and can conduct a restaurant business or concession without the need to utilize licensees or prospective licensees (captive venue units). Once operators have operated their franchised Chick-fil-A restaurant business for some period of time, the franchisor may offer them the opportunity to operate one or more additional restaurants or operate one or other opportunities (e.g., concession, delivery kitchen, or food truck).
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Training Overview: Operators must participate in an initial training program. The program is in person and lasts approximately five weeks, but the actual location and length of the program varies. The program currently utilized by the franchisor covers most aspects of operation, food preparation, accounting, service and customer relations, communications, maintenance, purchasing, planning, management styles, policies and marketing. The franchisor intends, though it is not obligated, to prepare and offer various seminars and conferences to operators from time to time in addition to its initial training program. In addition, the franchisor, at its election, offers various programs to or permit the adoption of programs by operators to use in promoting or marketing products, recruiting and retaining restaurant personnel or for other purposes that are not expressly set forth in the Franchise Agreement.
Territory Granted: The operator will be granted the limited right to operate one Chick-fil-A restaurant at a specific location designated by the franchisor. The rights granted to operators under the Franchise Agreement are limited to their franchised Chick-fil-A restaurant business location only and any additional business locations designated under an “additional business amendment” to the Franchise Agreement. Operators will not receive an exclusive or protected territory, express or implied. Operators may face competition from other franchisees or licensees, from outlets that the franchisor or affiliates own and/or operate, or from other channels of distribution or competitive brands that the franchisor or affiliates control.
Obligations and Restrictions: The Franchise Agreement requires operators to devote full time and personal best efforts to operate their franchised Chick-fil-A restaurant business to attempt to achieve the highest sales and profits possible and diligently develop and promote the reputation of the franchised Chick-fil-A restaurant business, Chick-fil-A, and CFA Properties’ marks. The franchisor requires operators to offer and sell only the Chick-fil-A brand products and other items that Chick-fil-A has approved. Operators must offer all products that the franchisor designates as required for all operators or for their particular franchised Chick-fil-A restaurant or associated food truck.
Term of Agreement and Renewal: The initial franchise term terminates on the earlier of December 31 of year the agreement is signed or when the lease expires, if earlier. The term is automatically extended for one-year periods unless written notice is given at least 30 days prior to end of existing term by either party.
Financial Assistance: The franchisor leases and subleases restaurant premises to its operators. The business terms for these leases and subleases vary depending on the type and the location of the Chick-fil-A restaurant. The franchisor provides extended payment terms for certain pre-opening expenditures under the Franchise Agreement and also rents equipment to its operators under the lease and under the Concession Sublicense Agreement for a captive venue unit and the Delivery Kitchen Agreement for a delivery kitchen unit. Otherwise, neither the franchisor, nor any affiliate of the franchisor, either directly or indirectly, offers any financing arrangements to operators.
Estimated Initial Investment
| Name of Fee | Low | High |
| Initial Franchise Fee | $10,000 | $10,000 |
| Opening Inventory | $22,000 | $84,000 |
| First Month’s Rental of Equipment | $750 | $5,000 |
| First Month’s Lease/Sublease of Premises | $2,725 | $96,285 |
| First Month’s Insurance Expense | $260 | $10,240 |
| Additional Funds | $391,000 | $2,134,000 |
| ESTIMATED TOTAL | $426,735 | $2,339,525 |
Other Fees
| Type of Fee | Amount |
| Advertising | May vary (a) between 0% to 3.25%, to be determined by Chick-fil-A, as a percentage of gross receipts or (b) by vote of operators in local or regional areas. |
| Advertising Support and Services Fee | Advertising support and services fees incurred, if any, will vary based upon the support and services offered by the franchisor, and selected and received by the operator; the current in-house blended hourly rate for services is $100; Operator will pay any additional fees, costs and expenses as applicable. |
| Additional Franchise Fee | $5,000 for each additional Chick-fil-A restaurant business. |
| Business Services Fee | $300 (monthly). |
| Rent (Traditional Unit) | $2,725 to $96,285 (including where applicable, percentage rent). |
| Occupancy Charge (Captive Venue Unit) | Determined under the concession agreement attached as an exhibit to the concession sublicense agreement; currently estimated to range between 4% and 30% of gross receipts. |
| Use/Occupancy Charge (Delivery Kitchen Unit) | Determined under the DK Lease attached as an exhibit to the Delivery Kitchen Agreement; currently estimated to range between 4% to 30% of gross receipts. |
| Food Truck Usage Fee (Food Truck Subleased from Chick-fil-A) | Currently $2,100 to $3,738, plus additional fees, costs and expenses. |
| Food Truck Usage Fee (Food Truck Leased from Vendor) | Currently $7,000 to $7,500. |
| Food Truck Insurance Fee (Food Truck) | Currently $305 to $525 (monthly). |
| Insurance | $260 to $10,240 (monthly). |
| Equipment Rental | Currently $750 to $5,000 (monthly). |
| Hardware and Software Support; High-Speed Internet Access | $9,500 to $20,000 (annually). |
| Fines – Minimum Standards and Procedures | Will vary under circumstances. |
| Indemnification | Will vary under circumstances. |
| Operating Service Charges | Determined by formula. |
| Credit Card Fees and Related Processing Fees | Will vary. |
| Highway Signage | Will vary under circumstances. |
| Interest on Late Payments | The maximum rate permitted by law, or if none, 1.25% per month. |
| Cash Handling System Services | $85 to $450 (monthly). |
| Reimbursement of Cost of Performance | Costs and expenses of performance. |
| Holdover Liquidated Damages | Double the base rent and percentage rent. |
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