Denny’s Franchise Costs, Fees & FDD

Year Business Began: 1953

Franchising Since: 1963

Headquarters: Spartanburg, South Carolina

Estimated Number of Units: 1,535

Franchise Description: DFO, LLC is the franchisor. Denny's restaurants are full service, family-style restaurants that offer and serve a wide variety of food. Denny's restaurants offer a casual dining atmosphere and moderately-priced food designed to appeal to a broad spectrum of customers. The franchisor offers franchisees the opportunity to operate a standard restaurant with its comprehensive system for developing and operating Denny's restaurants, which includes trademarks, building designs and layouts, equipment, ingredients, recipes and specifications for authorized food products, training, methods of inventory control and certain operational and business standards and policies. The franchisor also offers franchises for The Den, which is the franchisor’s limited service, non-traditional variation of the Denny’s concept, which may be distinguished from the standard Denny’s restaurant by a unique and modified menu. This concept may have limited or no table service.
Training Overview: The franchisor will provide management training for the franchisee, the managing owner or designated operator, if applicable, and the managers at an approved training restaurant. For all subjects, the franchisee, managing owner, and designated operator must attend. Restaurant managers must attend: Franchisee Manager-in-Training and Food Safety Training & Certification. All persons-in-charge must attend Food Safety Training & Certification. The Restaurant Manager in Training Program (MIT) is a comprehensive training program designed to equip both company and franchise managers with the necessary culinary, hospitality and restaurant management knowledge and skills to be a successful restaurant manager at Denny’s. The training program is divided into five modules. The New Restaurant Opening (NRO) and Training Assistance team will consist of one NRO Manager and up to seven additional trainers, depending upon the number of Denny’s restaurants which the franchisee owns and operates. The full NRO team consists of one NRO manager who will be at the restaurant for 21 days (13 days before, and 8 days after the restaurant opens), and seven trainers that will be at the restaurant 18 days (11 days before and 7 days after the restaurant opens, plus one travel day). In addition, the franchisor requires the three managers of the franchise restaurant be assigned to the NRO training team for a minimum of a six contiguous hour shift each day, to be scheduled by the NRO Manager, to each employee training session each day which will require some managers to work at night. Food Safety Training must be completed within 90 days of hire, unless the franchisee’s state requires less time. The franchisor may require additional training for managing owners, designated operators, restaurant managers or other employees of Denny's restaurants.

Territory Granted: Except for the franchisee’s right to operate a Denny’s restaurant at or from the premises of the restaurant, franchisees do not receive any exclusive territory or the territorial rights under the Franchise Agreement. Franchisees are required to operate the restaurant only at the location the franchisor has approved. Franchisees may not operate the restaurant or offer or sell any products or services at or from any location other than the approved location, though they may make off-site sales within an area the franchisor designates if it approves or requires franchisees to do so.

Obligations and Restrictions: The franchisor requires at least one individual who signs the Franchise Agreement to participate personally in the direct operation of the Denny's restaurant. This includes “on-premises” supervision to promote restaurant performance by guiding and directing employees to enforce brand standards in the daily operations of the restaurant. If franchisees are a legal entity, then they can satisfy this requirement if at least one of the owners/guarantors (referred to as the managing owner) meets the franchisor’s criteria. The managing owner must permanently reside near the restaurant so long as s/he exercises this role. If there is no individual franchisee or owner/guarantor with sufficient restaurant operations experience, or if qualified individuals do not meet the other requirements for this role, the franchisee must affiliate with a designated operator. The franchisor requires franchisees employ at least three managers for the restaurant. Only approved products and services may be sold in the restaurant.

Term of Agreement and Renewal: The length of the franchise term is the lesser of 20 years, 10 years or the lease term. There is no renewal option. However, although there are no renewal provisions in the Franchise Agreement, the franchisor may sign a 10- or 20-year Successor Franchise Agreement with qualified franchisees.

Financial Assistance: The franchisor is not obligated to do so, but it occasionally offers to finance the purchase of point-of-sale systems and other items introduced into the Denny’s system. The franchisor does not otherwise customarily accept notes or other instruments from franchisees and, accordingly, has not in the past sold, assigned, or discounted to a third party, in whole or in part, any note, contract, or other instrument executed by a franchisee. The franchisor has no present intent to sell, assign, or discount notes or instruments in the future to a third party. Neither the franchisor nor its affiliates receive revenue or other benefits from any person or entity for the placement of financing. The franchisor typically will not finance the purchase price or the initial franchise fee. In limited circumstances, the franchisor may finance a portion of the purchase price of a former company restaurant.

Estimated Initial Investment

Denny’s Diner 2.0

Name of Fee	Low	High
Initial Franchise Fee	$30,000	$30,000
Site Improvements	$50,000	$500,000
Building and Im­provements	$950,000	$1,500,000
Architectural Design	$30,000	$60,000
Equipment, Fixtures and Furnishings	$350,000	$450,000
Signs	$80,000	$120,000
Standard Enterprise Technology Platform	$25,000	$40,000
Opening Inventory and Supplies	$20,000	$30,000
Opening Advertis­ing	$3,000	$5,000
Opening Menus	$300	$800
Opening Gift Cards	$74.75	$74.75
New Restaurant Opening Training Team	$0	$36,000
Security Deposits	$10,000	$15,000
Insurance	$15,000	$20,000
Soft Costs (Permits, Survey, Inspections)	$5,000	$100,000
Additional Funds - 3 months	$50,000	$150,000
ESTIMATED TOTAL (exclusive of land)	$1,618,374.75	$3,056,874.75

The Den by Denny’s

Name of Fee	Low	High
Initial Franchise Fee	$10,000	$10,000
Building and Im­provements	$40,000	$250,000
Architectural Design	$15,000	$40,000
Equipment, Fixtures and Furnishings	$75,000	$195,000
Signs	$5,000	$20,000
Standard Enterprise Technology Platform	$20,000	$40,000
Opening Inventory and Supplies	$7,000	$20,000
Opening Advertis­ing	$3,000	$5,000
New Restaurant Opening Training Team	$0	$36,000
Security Deposits	$10,000	$15,000
Insurance	$15,000	$20,000
Soft Costs (Permits, Survey, Inspections)	$5,000	$25,000
Additional Funds - 3 months	$50,000	$150,000
ESTIMATED TOTAL (exclusive of land)	$255,000	$826,000

For Denny’s Travel Center (New Construction)

Name of Fee	Low	High
Initial Franchise Fee	$30,000	$30,000
Building and Im­provements	$405,000	$700,000
Architectural Design and Engineering	$20,000	$50,000
Equipment, Fixtures and Furnishings	$350,000	$450,000
Signs	$20,000	$90,000
Restaurant Technology Systems	$25,000	$40,000
Opening Inventory and Supplies	$20,000	$30,000
Opening Advertis­ing	$3,000	$5,000
Opening Menus	$340	$500
Opening Gift Cards	$74.75	$74.75
New Restaurant Opening Training Team	$0	$36,000
Security Deposits	$10,000	$15,000
Insurance	$15,000	$20,000
Soft Costs (Permits, Survey, Inspections)	$5,000	$75,000
Additional Funds - 3 months	$50,000	$150,000
ESTIMATED TOTAL (exclusive of land)	$953,414.75	$1,691,574.75

Other Fees

Type of Fee	Amount
Royalty	4.5% - 7% of gross sales.
Brand Building Fund	3% - 3.25% of gross sales.
Virtual Brand Offering Royalty Fee	4.5% of gross sales.
Virtual Brand Offering Brand Building Fee	3% of gross sales.
Local Advertising Co-op Fee	As determined by the co-op.
Menus	$300 to $800. Prices subject to change for each menu rollout.
Gift Cards	$74.75 per box.
Additional Manage­ment Training	None.
New Restaurant Open­ing Training	$0 to $36,000
Insurance	Actual cost.
Reimbursement for Products, Services, etc.	Actual cost.
Audit	Cost of audit.
Testing	Actual cost.
Correction of Defi­ciency or Unsatisfac­tory Condition	Actual cost.
Assignment	To be determined by the franchisor from time to time, currently $5,000 per restaurant, and $7,500 for every restaurant which changes owners past its remodel due date.
Rent	Varies depending on type of lease.
Sublease	75% of amount by which sublease rent paid to franchisee exceeds rent paid to franchisor.
Interest	Lesser of 15% per year or maximum legal rate.
Successor Franchise	$10,000 or $30,000
Costs and Attorneys' Fees	Actual cost.
Indemnification	Actual cost.
Standard Enterprise Technology Platform Support	To be determined by the franchisor and may vary by location.
Credit Card Fees	As determined by third party card processors.
Denny’s on Demand (off-site ordering and delivery)	$250 activation; $39 monthly; $0.19 per order; $0.06 dispatch fee per transaction; $.86 for delivery.
SCOC Surcharge	$0.02 per case
iLumen — Aggregation of Franchise P&Ls	$200
CREATE  - Graphic Design Service	As incurred.
Call Center Ordering	As incurred.
Cost to Indemnify Franchisor	As incurred.

The above information has been compiled from the FDD of Denny's. Year of FDD: 2025.
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