Culver’s Franchise Costs, Fees & FDD

Year Business Began: 1984

Franchising Since: 1990

Headquarters: Prairie du Sac, Wisconsin

Estimated Number of Units: 1,000

Franchise Description: Culver Franchising System, LLC is the franchisor. The franchisor grants franchisees the right to operate a Culver’s restaurant within a certain geographic area. Culver’s restaurants offer burgers, sandwiches, salads, dinners, frozen custard desserts, beverages and other menu items for drive-thru, carryout and on-site consumption in a quick-service, casual dining setting.
Training Overview: Before opening the restaurant, the management team at the restaurant, which in addition to franchisees will typically include six to eight individuals, must have attended and completed an approved Culver’s Manager in Training Program to the franchisor’s satisfaction. The franchisor requires that all managers, which must include a minimum of six employees, are certified in the franchisee’s state’s sanitation program, the ServSafe equivalent, or, if no state requirement exists, in the national sanitation program. In addition, the operator must complete the franchisor’s full-time, 16-week franchisee development training program to its satisfaction, at one of the franchisor’s designated company-owned restaurants. Franchisees must attend or participate in any periodic reconnection training courses or programs that the franchisor designates. In addition to the training courses and programs the franchisor provides, franchisees must participate in an electronic training program accessible via the Internet that it develops or select for the system, including all future updates, supplements or modifications.

Territory Granted: Under the Franchise Agreement, franchisees may only operate their restaurant at a specific location. Franchisees will typically receive a “designated territory” that will be a three-mile radius around the location of the restaurant, which may be smaller if such area contains a physical or perceived barrier (e.g. a river or a highway), a high population of people who live or work near that area, if franchisees propose a location which is not a freestanding site, and/or does not have a drive thru, and/or does not have its own dedicated parking lot, or if it contains another existing or potential trade area.

Obligations and Restrictions: If franchisees are an individual, they must be the full-time on-site owner-operator and personally manage the restaurant unless they receive the franchisor’s prior consent to delegate their authority to do so. If franchisees operate more than one restaurant, they may delegate certain management duties for additional restaurants to one or more managers that the franchisor approves. If franchisees are a corporate entity or a partnership, one individual (the operator) must retain at least 50% of the equity and voting interest in the corporate entity or partnership and will be obligated to be the full-time on-site operator who personally manages the restaurant. In the alternative, one individual operator may retain at least 25% of the equity and voting interest in the corporate entity or partnership, so long as that individual also has at least 25% ownership in the building and real estate, and he or she must be the full-time on-site operator and personally manage the restaurant. If franchisees are a corporate entity or a partnership, they must indicate the ownership structure and identify the ownership interests on the franchisor’s Certification of Business Entity. Franchisees must offer and sell all, and only, those goods and services that the franchisor has approved. Except for off-site sales that the franchisor specifically agrees to in writing, franchisees may serve customers only from the restaurant they have been authorized to operate.

Term of Agreement and Renewal: The length of the initial franchise term is 15 years. If franchisees are in good standing, they can renew the Franchise Agreement for one additional term of 10 years.

Financial Assistance: The franchisor does not offer direct or indirect financing. The franchisor does not receive payments or other consideration for the placing of financing or guarantee any note, lease or other obligation franchisees may enter into or incur. The franchisor currently offers a “Veterans’ Discount”, whereby it will reduce the initial franchise fee by $10,000 for qualified franchisees.

Estimated Initial Investment

Name of Fee	Low	High
Initial Franchise Fee	$20,000	$55,000
Land	$240,000	$2,700,000
Site Work	$95,000	$1,590,000
Building	$1,507,000	$2,946,000
Travel, Living and Expenses During Training	$20,000	$80,000
Initial Inventory	$50,000	$65,000
Furniture, Fixtures Equipment and Supplies (Excluding Sign Package and POS Cash Register System)	$467,000	$590,000
Sign Package	$120,000	$336,000
POS System	$38,500	$51,000
Miscellaneous Expenses	$20,000	$40,000
Additional Funds (working capital) - for 3 months	$65,000	$120,000
ESTIMATED TOTAL	$2,642,500	$8,573,000

Other Fees

Name of Fee	Amount
Service Fee	4% of gross sales.
Advertising Fee	2.5% of gross sales.
Cooperative Advertising	Up to 4% of the gross sales, as approved by a majority vote of the members of the co-op advertising region.
Additional Training	$1,000 per person.
Additional Assistance	$500 per week.
Site Review Fee	$500 per site after four site reviews.
Custom Design Fee	Up to $5,000.
Extraordinary Building Assistance Fee	Up to $50,000.
Building Conversion Fee	Up to $10,000.
Excessive Site Location Design Fee	$500 per site location after four site locations.
Transfer Fee	$10,000 plus the franchisor’s attorneys’ fees; $5,000 plus the franchisor’s attorneys’ fees if the buyer is an existing franchisee.
Renewal	$30,000
Insurance	Will vary under certain circumstances.
Audit	Cost of inspection or audit.
Interest	Lesser of 1.5% per month or highest contract rate of interest allowed by law.
Management Fee	To be determined under circumstances.
Gift Card Fees	Currently $0.22 cents per redeemed transaction.
Costs and Attorneys’ Fees	Will vary under circumstances.
Indemnification	Will vary under circumstances.
Supplier Payments	Will vary under circumstances.
Testing	Cost of testing.
Relocation Expenses	Costs of relocation.
Technology Fee	Estimated $600 - $1,000 per month.
Development Schedule Extension Fee	$20,000 per restaurant for an extension of up to six months for the dates to sign the Franchise Agreement and to open the restaurant.
Development Agreement Termination Fee	$50,000 for each restaurant to be developed under the franchisee’s development schedule for which they have not signed a Franchise Agreement or paid an initial franchise fee.
Territory Reservation Extension Fee	$20,000 for an extension of up to six months for the date to sign the Franchise Agreement.

The above information has been compiled from the FDD of Culver’s. Year of FDD: 2025.
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