Chick-fil-A is one of America’s most sought-after and difficult fast-food franchises to operate, but its initial franchise fee is surprisingly low compared with many competing restaurant brands.
The Atlanta-based chicken chain charges a $10,000 franchise fee, a figure that has remained unchanged for 50 years, according to Chick-fil-A owner-operator Julian Good, who recently discussed the business model on the “Founder Talk” podcast.
Chick-fil-A receives thousands of applicants
Despite the relatively low entry fee, getting the opportunity to operate a Chick-fil-A restaurant is highly competitive.
Good said approximately 100,000 people apply each year, while only about 200 applicants are ultimately selected as owner-operators.
For applicants without previous Chick-fil-A experience, the process can take three to five years before an opportunity becomes available, Good said.
Chick-fil-A itself describes its selection process as highly competitive and says it seeks leaders willing to devote their full time and best efforts to operating a restaurant.
You don’t need Chick-fil-A experience
Previous employment with Chick-fil-A isn’t required to apply.
According to company information cited by Fox News, more than 25% of newly selected operators had never previously worked for Chick-fil-A.
Operators have come from a wide range of professional backgrounds, including health care, manufacturing, education, law enforcement and retail.
The unusual part of the Chick-fil-A franchise
Chick-fil-A’s business model differs significantly from the traditional franchise system.
Operators generally do not own the restaurant, equipment or real estate. Instead, Chick-fil-A retains ownership while the selected operator runs the location.
That means operators don’t build traditional ownership equity in the restaurant and generally cannot sell or pass the business on to their children when they retire.
“When a Chick-fil-A operator retires, you can’t pass it down to your kids,” Good said, according to Fox News.
Why the $10,000 fee doesn’t tell the whole story
The $10,000 franchise fee may make Chick-fil-A appear inexpensive compared with traditional franchise opportunities, but the company’s highly selective operator model is a major barrier.
Rather than simply investing money to purchase a location, applicants must first convince Chick-fil-A that they have the leadership skills and commitment required to operate one.
The model also means selected operators take on a hands-on management role rather than simply treating the restaurant as an investment.
Chick-fil-A’s Sunday closure remains part of its model
Another distinctive feature of the chain is its Sunday closure policy. Chick-fil-A restaurants remain closed every Sunday, a longstanding practice that the company says is part of its culture.
The combination of a relatively low franchise fee, intense applicant competition and a business model in which Chick-fil-A retains ownership makes the chain one of the most unusual franchise opportunities in the U.S.
For aspiring restaurant owners, the biggest challenge may not be finding the $10,000 fee—it may be becoming one of the roughly 200 people selected from tens of thousands of applicants each year.
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