McAlister's Deli Franchise Costs, Fees & FDD

Year Business Began: 1989

Franchising Since: 1994

Headquarters: Atlanta, Georgia

Estimated Number of Units: 550

Franchise Description: McAlister’s Franchisor SPV LLC is the franchisor. The franchisor an indirect, wholly-owned subsidiary of GoTo Foods Systems LLC (formerly known as Focus Brands). McAlister’s Deli restaurants are fast casual restaurants offering counter service, on-premises dining and take-out services and featuring a line of deli foods, including hot and cold deli sandwiches, baked potatoes, salads, soups, desserts, iced tea and other food and beverage products.
Training Overview: Prior to the opening of the restaurant, the required trainees must attend and successfully complete to the franchisor’s satisfaction the management training program. Currently, classroom training (50 hours) for the management training program is conducted through online modules and on-the-job training (250 hours) is conducted at a certified training location. In addition to completing the management training program, if the franchisor determine that the required trainees do not have sufficient restaurant experience (the franchisor typically require six to 12 months of restaurant management experience), it may require them to participate in additional on-the-job training at a location that it designates. If the primary contact will not be involved in the day-to-day operation of the restaurant addition, they must successfully complete a limited version of the management training program designed for primary contacts (the “primary contact training”). Currently, primary contact training is approximately one to two weeks long. For the first three restaurants (including restaurants owned by affiliates), the initial franchise fee includes the cost of one or more of the franchisor’s representatives to provide on-site training and assistance (approximately seven days after franchisees obtain their certificate of occupancy and health permit) to facilitate the opening of such restaurants. The franchisor may, from time to time, conduct conferences, conventions, programs, webinars, teleconferences, or training sessions on any matters related to the system. The franchisee’s primary contact, managers, owners, and supervisory personnel must attend any conferences, conventions, programs, or additional or refresher training sessions that the franchisor specifies.

Territory Granted: The restaurant may only be operated at the accepted location. If the franchisor has not yet accepted a site for the restaurant when the franchisor executes the Franchise Agreement, franchisees must select a location that the franchisor accepts in accordance with its site selection criteria within a site selection area that it specifies. Franchisees may receive a territory with limited protected rights (area of protection). During the term of the Franchise Agreement, the franchisor will not establish or operate, nor license any other person to establish or operate, a restaurant operating under the proprietary marks and the system at any location within the area of protection, except in “captive audience locations” and as otherwise provided in the Franchise Agreement. The size and scope of the area of protection will be in the Franchise Agreement and will be determined on a case-by-case basis.

Obligations and Restrictions: The franchisor does not recommend an investment in a restaurant for investors interested in an absentee management business. Franchisees must have four managers who are dedicated to the restaurant, one of whom may also be the primary contact. Franchisees may offer in the restaurant to customers only the approved products that the franchisor has approved in writing. Franchisees must produce and sell all approved products the franchisor specifies, including all menu items, trademarked product lines, and other products and services that the franchisor requires franchisees to sell, as stated in the manuals or otherwise, which are all part of the system. Franchisees must offer all approved products that the franchisor designates as mandatory. If the franchisor requires or authorizes franchisees to sell alcoholic beverages, they must obtain any necessary permits or licenses. Franchisees must participate in any market research programs or testing in their restaurant, and provide the franchisor with timely reports and any other relevant information it requests.

Term of Agreement and Renewal: The length of the initial franchise term is 20 years. If franchisees comply with the franchisor’s renewal requirements, one 20-year renewal term is available.

Financial Assistance: The franchisor does not offer financing for trade fixtures, opening inventory, or any other purpose. The franchisor may refer franchisees to leasing or financing companies not affiliated with it. The franchisor and its affiliates receive no fees or other financial benefits from any lender for the franchisee’s financing. Currently, the franchisor will not guarantee a franchisee’s note, lease, or obligation, for any lender, or any other person or entity. The franchisor may engage an advisor to provide consulting services to franchisees to assist them with securing financing, and it may pay the advisor for this assistance to franchisees. The franchisor participates in the International Franchise Association’s VetFran program. For qualifying veterans or members of the Armed Forces, the initial franchise fee is reduced to $20,000.

Estimated Initial Investment

Name of Fee	Low	High
Initial Franchise Fee	$35,500	$35,500
Construction and Build Out Costs	$500,000	$1,317,800
Permitting	$1,250	$15,000
Equipment Package	$237,300	$298,000
Millwork	$39,900	$60,000
Furniture	$20,000	$51,000
Menu Board, Graphics and Interior Signage	$9,600	$28,000
Exterior Signage	$21,000	$133,000
Computer System	$32,000	$58,000
Smallwares	$21,000	$25,400
TV/Music	$3,400	$12,500
Architect/Engineer	$15,000	$64,200
Rent	$7,200	$18,600
Grand Opening Marketing	$25,000	$27,000
Legal and Accounting Fees	$2,700	$10,000
Insurance	$1,925	$9,500
Misc. Opening Costs/Security Deposits	$2,500	$33,000
Management Training Program Fee	$0	$25,000
Travel and Living Expenses During Training	$26,200	$33,700
On-Site Training Fee	$0	$34,000
Opening Inventory	$18,500	$100,000
Additional Funds (3 months)	$25,000	$53,000
ESTIMATED TOTAL*	$1,044,975	$2,442,200

*The estimated initial investment range given covers from a restaurant at an end-cap or inline shopping center location up to a newly-constructed freestanding location.

Other Fees

Type of Fee	Amount
Royalty Fee	5% of net sales.
Advertising Contribution (for new or renewing restaurants)	Currently, 2% of net sales.
Advertising Cooperative Contribution	An amount set by the franchisee’s advertising cooperative.
Local Marketing Obligation	Currently, each calendar quarter, franchisees must spend not less than 0.75% of net sales on local market advertising.
Promotions and Advertising Materials	Up to 110% of the franchisor’s or its affiliates’ actual costs and expenses related to the goods franchisees purchase from the franchisor or the affiliates.
Insufficient Funds Fee	Up to 110% of the franchisor’s or its affiliates’ actual costs and expenses.
Interest	The lesser of 1.5% per month or maximum legal interest rate.
Late Reporting Fee	The then-current fee. Currently, $50 per day.
Taxes and Other Payments	The franchisor’s cost.
Subsequent Trainee Initial Training Fee	Currently, $250 per trainee per day.
On-Site Training and Assistance	A reasonable fee. Currently, $500 per week per trainer, plus their direct airfare expenses.
Additional Support/Consulting Fee	A reasonable fee. Currently, $500 per representative per day, plus their travel and living expenses.
Conference/Program Fee	A reasonable fee, which will vary by program. Currently, ranges from $0 to $2,500 per attendee.
Training Cancellation Fee	The fees for the cancelled program and the franchisor’s out-of-pocket costs.
Learning Management System License Fee	The then-current fee. Currently, $210 per year.
Sublease Administration Fee	The then-current fee. Currently, $200 per year.
Lease Renewal/Extension Review Fee	The franchisor’s then-current fee. Currently, ranges from $500 for a lease term of two years or less to $2,000 for a term of five years or more.
Lease Documentation Fee	$500 per month (or partial month) until delivered.
Relocation Fee	10% of the then-current initial franchise fee.
Relocation Extension Fee	$1,500 per year that the term is extended.
Refresh/Remodel Site Survey and Design Fee	The then-current fee. Currently, such fee is approximately $1,200 to $6,000 depending on the scope of the required changes.
Transfer Fee	50% of the then-current initial franchise fee if it is a control transfer; if it is a transfer to a related party or that is a non-control transfer, 10% of the then-current initial franchise fee.
Renewal Fee	20% of the then-current initial franchise fee.
Computer Systems Fee	A reasonable fee, which will vary based on the services provided.
POS System License and Lease Fees	Currently, $351 to $456 per month if franchisees purchase the POS System under the CapEx Program and $1,254 to $1,606 per month if they lease the POS system under the HaaS Program.
POS System Support Fee	Currently, estimated to be between $125 and $250 per month.
POS System Administration Fee	The then-current fee, which is currently estimated to be between $1,500 to $2,000.
Non-GoTo Foods Portfolio POS Menu Setup	A reasonable fee, currently estimated to be $500 per day.
Back Office and Polling Software Fee	A reasonable fee. Currently, not charged.
Credit Card Fees	Transaction fees estimated to be from 2.5% to 5% of transaction amounts. Other fees may apply depending on the vendor used for credit card processing.
Information Security and Compliance Fee	Currently, not charged.
Gift Card and Loyalty Program Fees	Amount of administrative fees.
Loyalty App Fee	Currently, $62 per month.
Online Ordering Fee	Currently, $141 per month, plus a per transaction fee (currently, 0.04% per transaction) and additional charges based on services subscribed to.
Ordering Support Fee	The then-current fee, which will vary based on the services provided.
Technology Fee	The then-current fee. Currently, this fee is not collected.
Purchasing Program Fee	Reasonable membership fees assessed by the purchasing program.
Supply Chain Fee	Currently, $0.49 to $0.65 per case purchased through certain appointed distributors.
Master Insurance Policy Fee	Currently not charged; the franchisor does not have an estimate at this time.
Insurance	Amount of unpaid premiums and up to 110% of the franchisor’s actual costs and expenses.
Guest Relations Fee	Currently, $30 for each guest complaint or other contact request that franchisees do not timely respond to or for each excessive guest complaint.
Non-Compliance Fee	Currently, $25 to $500 for a single default, but may vary based on the severity of defaults and repetition of defaults.
Failure to Comply with Standards or Law Fee	Currently, up to a $5,000 fee plus the franchisor’s reasonable expenses connected with any inspection, examination, or analysis of products or the restaurant.
Development Deadline Extension Fee	$2,500 per missed deadline.
Repeated Inspection Fee	$500 non-compliance fee, plus any costs the franchisor is charged by third-party inspectors or otherwise incurs.
Reimbursement of Services After Default	All costs and expenses that the franchisor reasonably incurs.
Audit	Cost of audit.
Liquidated Damages	The average monthly amount of royalty that franchisees owed the franchisor during the past 36 months times the lesser of remainder of term of Franchise Agreement or 36 months.
Appraiser’s Fee	50% of appraiser’s fee.
Indemnification of the Franchisor	The franchisor’s cost and expenses.
Attorney’s Fees	The franchisor’s cost and expenses.
Reinstatement Fee	10% of the amount of the then-current initial franchise fee, plus royalty fees that would have been payable in period between termination and reinstatement.
De-identification Fee	The franchisor’s actual costs, plus interest and an administrative fee equal to 15% of its actual costs.

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