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How Much Does a Wendy’s Franchise Cost?




Wendys Franchise

In the Beginning Was the Burger

Thanks to a series of iconic TV commercials, pretty much everyone knows that the late Dave Thomas started the Wendy’s hamburger chain with a single restaurant in 1969, naming the place after his daughter.  Eleven years later there were two thousand Wendy’s restaurants across the country.  Today Wendy’s is part of Wendy’s / Arby’s Group Inc., ranking as the country’s third-largest “quick service” restaurant conglomerate.  Last year the corporation enjoyed more than $1.2 billion in sales.

Wendy’s Franchise Review

The company began its franchising model in 1972, when Thomas sold the first one to a hamburger bun manufacturer in Indianapolis.  The company opened its 100th location in 1975 in Louisville, Ky., and reached the 500-store mark a mere eighteen months later.  As with most fast-food establishments, each restaurant is designed to look the same, with identical menus no matter the location as well as consistency in food product, service standards, and quality control.  Several sources claim that the company is not currently accepting franchise applications domestically – with Canadian and international opportunities still available – but that situation could change at any time.  There are more than 6,600 franchise units worldwide.  Quite a few Wendy’s franchisees operate multiple locations in various cities around the country.  The largest franchisee is DavCo, which opened its first Wendy’s restaurants in 1976 – Baltimore, St. Louis and Washington, D.C. were the sites – before expanding to other parts of the country.  In 1999, the franchise owners sold off units from several other cities to consolidate its hold on the Baltimore – Washington market.  In 2002 it operated 155 Wendy’s restaurants in that area alone.

Wendy’s Franchise Information & Costs

To be considered for a Wendy’s franchise, one must first pay a franchise fee of $25,000.  The likely total investment will range from $250,000 to $600,000, largely dependent upon the cost to acquire a parcel of land and construct the building.  A prospective franchisee is required to have a net worth of $1 million, with a minimum of $500,000 in liquid assets (cash).  After opening for business, the franchise owner pays a four percent annual royalty to the parent company, based on gross sales volume.  There are no additional charges for training, and the royalty fee covers advertising costs.  Each restaurant, designed to be a free-standing building with a drive-through lane and lots of parking, runs just under 3,000 square feet with a dining room designed to seat around 90 patrons.

Where’s the Beef?

The company’s campaign slogan from the mid-1980s helped make Wendy’s one of the most popular hamburger restaurants around.  The franchise is known for serving up fresh ingredients in a brightly lit atmosphere, with square burger patties and chili the primary menu items.  Additional popular items include chicken-breast sandwiches and Frosty soft-serve ice cream treats.  Every food item is cooked to order.  One of the strongest recommendations for a potential franchise owner is the backing offered by the home office – based in suburban Columbus, Ohio, where the first Wendy’s opened – along with a strong sense of social dedication.  Prior to the founder’s death in 2002, Thomas was known to be a strong advocate for various causes, notably the Foundation for Adoption that helps place foster children in permanent homes.  Individual storeowners are encouraged to give something back to their own communities as well.

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