Burger King is a fast food restaurant chain currently headquartered in Miami-Dade, Florida. Founded in 1953, Burger King maintains 15,000 locations worldwide through its well-known franchise program.
About the Company
Burger King specializes in providing low cost and efficiently prepared food items to customers. The menu is wide ranging and includes various hamburgers, french fry products, ice cream, soda, salads and specialty items.
Each Burger King is independently owned and operated, and the company as a whole is a subsidiary of Restaurant Brands International.
Burger King Franchise Costs and Expected Revenue
The minimum financial requirement to own a Burger King franchise is $1.5 million total net worth. The cash liquidity portion of the net worth should be at least $500,000. In some types of franchise transactions, the minimum financial requirements might be significantly higher.
The total financial cost of opening a franchise can range between $1.2 million and $2.2 million, depending on location, building size and any updates or upgrades that need to be completed. The initial franchise fee for a Burger King is $50,000, which must be paid prior to the opening date of the location. Once the restaurant opens for business, a monthly royalty fee of 4.5 percent of gross sales is required by the parent company.
The actual revenue expected for a Burger King will vary depending on location on foot traffic, but estimates place the median annual sales of traditional Burger King locations at $1.081 million.
Pros of Owning a Burger King Franchise
One of the biggest pros of owning a Burger King franchise is name recognition. Burger is a well known and well respected fast food chain with millions of dollars poured into national advertising every year.
Training for new franchise owners is also very extensive. The total time adds up to 84 days of training in the classroom and seven weeks of on site training at the actual restaurant. Most new franchisees feel that the training gives them a good grasp on operating a fast food restaurant.
Profit margins have also been very attractive for many franchise owners, especially those who own locations in high traffic or high value areas.
Cons of Owning a Burger King Franchise
The biggest downside to starting a Burger King franchise is the initial startup cost and financial requirements. Most potential franchisees find it difficult to accumulate $500,000 in cash liquidity before applying for the franchise, and might find themselves looking for a more affordable option.