Fewer than 1% of those who apply to become Chick-fil-A franchisees are approved, and if the rumors are true, the real number is closer to 0.1% — which would make it harder to own than getting into any of the elite universities in the United States.
It’s easy to see why people are so excited to run their own Chick-fil-A. While it’s still hard work, a Chick-fil-A franchisee has higher odds of success than almost any other fast food chain. Non-mall locations gross over $8M per year, and the owner’s earnings are around 5% of that, meaning if you own one, you can expect to make $400,000 per year!
It’s not all gravy err….Chick-fil-A Sauce
1) As I mentioned, the odds of getting approved to operate a Chick-fil-A are more or less zero. You could submit a perfect application for 100 years, and you probably will never hear back. A quick glance at their future store openings page will help you understand how rare it truly is.
2) Per Chick-fil-A’s rules, you aren’t allowed to operate more than one store, and you must personally work at your location. If you have dreams of building a fast food empire, they end the day you become a Chick-fil-A franchisee.
3) You don’t own “your” store. While other franchisers allow you to build equity in your business, and sell it when you want to retire, Chick-fil-A simply does not. In my opinion, you are much closer to a contractor for Chick-fil-A than an owner.
Grounds for hope
That said, if you love the product and believe in the franchise, there is a way to get involved in their success, and put your money behind them, without ever applying.
Former McDonald’s CFO Harry J. Sonneborn is quoted as saying: “We are not technically in the food business. We are in the real estate business. The only reason we sell fifteen-cent hamburgers is because they are the greatest producer of revenue, from which our tenants can pay us our rent.”
If McDonald’s is a real estate business that happens to sell hamburgers, what if you could build your Chick-fil-A empire in the same way?
Below are three Chick-fil-A locations that are currently for sale. And I want to emphasize the word locations. You aren’t buying the restaurant. That will continue to be owned by Chick-fil-A and operated by the franchisee. You’re buying the ground from underneath them!
Your brand new tenant comes with an incredible balance sheet and an almost non-existent history of closing locations, often with long-term leases and built-in rent increases.
You’d want to consider this investment vs others, namely treasuries. You can get a higher yield on a 10-year bond than all of these locations, but if you’re determined to invest in Chick-fil-A’s success, this is frankly the quickest path. Click the images below to learn more about each opportunity from the broker who listed them:
Shelton, CT
Source: Loopnet
Dublin, GA
Chick-Fil-A Location in Dublin, GA. Image via Loopnet.
Big Spring, TX
Source: Loopnet
If none of these locations suit your investment profile, or the down payment would be more than you’d prefer, you can keep an eye on Chick-fil-A’s future openings. You can also use the address of these locations to look for other commercial or residential real estate opportunities. Chick-fil-A corporate are some of the best at what they do, and odds are if they’re investing in a location, it will be a long-term winner for them and you as well.
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