As one of the most well-known fast-food companies in the United States, KFC offers a franchise opportunity that not many people pass up as long as they have an interest in the sector. KFC is committed to improving people’s lives. They actively promote diversity and inclusion while assisting the local community in the fight against hunger.
As of July 27, 2020, KFC had 22,600 locations across 135 nations, with a brand value of US $8.3 billion and $27.9 billion in sales.
According to IBISWorld, the chicken franchises market size is $56.6 billion in the United States with a growth rate of 1.8% from 2013-2018. Cumulative Market growth for 2018 to 2023 is anticipated at 8.4%.
What is the full form of KFC?
KFC refers to Kentucky Fried Chicken, and Harland Sanders created the company in 1930 if you are not cognized of the same.
General information about Kfc franchise
Although KFC began as a straightforward company selling only traditional fried chicken, it now offers a wide range of chicken dishes, including the beloved classic as well as sandwiches, grilled chicken, and boneless wings; let’s not even brought up the side items, such as fries. Although not all franchises are the same, KFC offers a variety of franchising options with varying expenses associated with them based on location size and the kind of restaurant you want to create.
KFC provides a variety of foods to keep up with modern tastes. In order to appeal to a wider audience in nations like India, it has now launched a number of vegetarian choices. Also, KFC customizes its menu based on the nation in which it operates.
Is KFC a Franchise Business?
KFC is a franchising opportunity. In fact, it is considered to be one of the most unquestionably profitable and rewarding opportunities for those looking to launch a retail-based food service franchise in the US.
Facts and History Nobody Told You Of KFC
- Harland Sanders, also known as Colonel Sanders created KFC.
- The first KFC restaurant debuted in 1952 in Salt Lake City.
- Kim Kardashian owns a pair of KFC Crocs, which you can also purchase.
- The KFC name was formally adopted in 1991.
- KFC is traditionally consumed on Christmas Day.
- The name was officially adopted as KFC in 1991.
- The KFC recipe is an extremely well-kept secret.
- KFC in South Africa sponsored a wedding for a couple who got engaged there.
- The Colonel has a video game of his own. It is known as Colonel Quest.
- The Colonel began his chicken empire in 1939, but the first KFC bucket meal was sold in 1957.
- There are many different options to customize your KFC order.
|KFC Franchise Review and Information|
|Industry Type||Food Franchise Opportunities|
|Sub Category||Chicken Franchise Opportunities|
|Company Name||Kentucky Fried Chicken, a subsidiary of Yum! Brands|
|Founder/Management Head||Tarun Lal, President|
|Employees at Company H.O||400|
|Franchise Expansion Plan||US and worldwide|
|Number of Units||26,498 (as of 2022)|
|Number of Franchise Units||3872 (as of 2021)|
|Social Media Handles|
|Company Office location||Louisville, KY|
KFC Franchise Requirements
The minimum cash required to start a KFC franchises is $750,000. Further, the minimum net worth required by a potential franchisee is $1,500,000. The franchise fee and franchise cost along with the royalty fee are provided hereafter in the blog. This is coupled with a royalty fee of 4-5% and an advertising fee of 5%.
How much does a KFC franchise cost?
As far as the cost of a KFC franchise is concerned, the franchise fee to become a successful franchise owner is $45,000 which is generally coupled with an initial cost ranging somewhere between $1,440,600-$3,163,550 which might prove to be a little costly for people.
|KFC Franchise Price and Costs|
|KFC Franchise Fee||$45,000|
|KFC Franchise Cost||$1,440,600 – $3,163,550|
|Term of Agreement||20 years|
|Is franchise term renewable?||Yes|
How much do KFC franchise owners make?
I will project the KFC franchise profit and years to recoup the investment (ROI).
|AUV||Estimated Annual Profit (12.5%)||Estimated Annual Profit (15%)||Estimated Annual Profit (18%)|
|Recoup mid-point$2,302,075||14 years||11 years||9 years|
The estimated KFC franchise profit is in the range of $159,909 to $230,269 and it will take 9 to 14 years to recoup the investment.
According to industry standards, getting a return on the franchise investment will take a very long time.
KFC Training to Franchises
Franchisees are required to participate in and successfully complete the KFC LLC initial training program on operating an outlet to the satisfaction of the franchisor. A key operator may be chosen by a franchisee to finish the Key Operator Restaurant Training. At the franchisor’s direction, all other employees of franchisees are required to attend and finish the training program to KFC LLC’s satisfaction.
All training sessions shall be organized as necessary at the national, regional, or divisional headquarters of KFCLLC, as well as any additional locations that the franchisor may specify. Training options include classroom instruction, written material, on-the-job training at other outlets, computer-based training through its Learning Zone platform, and written material.
The person who successfully completes the Key Operator Restaurant Training will instruct staff members at the franchise establishment. At such times and locations as KFCLLC reasonably requires, the franchisor may require franchisees and their staff to attend and complete ongoing and additional refresher training courses, programs, and seminars.
KFC Operations to Franchises
KFC offers its franchisees a variety of resources and opportunities. There are non-traditional options available along with traditional establishments that could increase the opportunities for franchisees and the business. These are smaller alternatives with 900 square feet or so of usable space for places like airports, universities, truck stops, etc.
The company provides classroom instruction, continuing assistance, and several weeks of on-the-job training. Some of this assistance consists of marketing assistance to go along with KFC’s already successful and award-winning advertising.
Establishing a KFC franchises might provide a more certain outcome when compared to making an investment in a brand that can struggle to succeed in a crowded and competitive market.
How is KFC Territory Granted to Franchises
Franchisees won’t be given a territory that is exclusive in nature. However, as long as franchisees are in compliance with the Franchise Agreement, they will have a protected territory of the smaller of
- an area within 1.5 miles of the outlet
- within a 30,000-person radius around the outlet; or, in the case of a metropolitan region with more than 100,000 inhabitants, within a 30,000-person radius within the metropolitan area.
The fulfillment of a specific sales volume, market penetration, or other performance criteria shall not be a prerequisite for the franchisee’s rights with regard to the protected territory.
What is the Franchise Term of Agreement and Renewal?
The initial term of a KFC franchising is 20 years. Franchisees can renew the same if they satisfy the requirements, but they might be required to sign a new agreement that materially differs from the first agreement’s terms and conditions.
Does KFC provide Financial Assistance to Franchises?
For eligible minorities, YUM provides an optional financing aid program. The finance for new minority franchisees looking to buy an existing outlet, an existing company-owned outlet, or establish an entirely new outlet is covered under the YUM Minority Assistance Program. Up to a total of $3,000,000 for each loan or franchisee, YUM may guarantee 25% of the franchised company loan’s principal.
The YUM Minority Lending Help Program may be terminated by YUM at any time. Apart from what is stated, KFCLCC fails to provide any arrangements for funding a franchisee’s initial investment or ongoing KFC company operations.
Pros & Cons of owning a KFC Franchise
Pros of owning a KFC Franchises
- Franchising for over 70 years as a reliable franchisor.
- A good company in the fast-food industry
- KFC team handles all the processes while getting started, this includes finding a location, training potential employees, etc.
- The short duration of training
- A worldwide brand and franchise
- expanding and strong franchise despite COVID-19 issues and circumstances
- Success is all but a given if you are situated in the appropriate area.
- Availability of a variety of choices.
- Franchise offers recognition, awareness, and everything else required by the franchise
Cons of Owning a KFC Franchising
- No financing
- A tedious task of handling royalties for the rest of your life
- Requirement of following the terms and rules along with renewing the contract to continue operating for a period of every 20 years
- Can prove to be an expensive start
- A digital fee of 3.5% of gross revenue from all digital orders.
- No availability of absentee ownership
- High investment of time
- No exclusive territories.
KFC Franchise Rankings
- 13 in 2023 under Franchise 500 Ranking
- 3 in 2022 under Fastest-Growing Franchises
- 1 in 2022 under Top Global Franchises
- 3 in Chicken in 2022 under Top Food Franchises
Franchise Deck Analysis and Overview
You must be financially prepared for an initial investment including a franchises fee and other initial expenses if you want to join the KFC franchising team. You should also be ready for recurring costs such as advertising, royalties, and possible renewal fees. Franchisees must also satisfy the established net worth and liquid capital standards of the franchisor.
The bucket of fried chicken at KFC is famous among people. This is frequently served with a few sides to provide a complete dinner for a single person or a family. While the restaurant’s cornerstone is this comfort cuisine, new items are occasionally introduced to the menu, creating a wonderful blend of familiarity and innovation.
The employer tends to seek motivated and devoted employees. KFC franchisees can anticipate being actively involved in the day-to-day operations of the business. Also, there is a strong emphasis on innovation, simplification, and improvement to satisfy customers. This can be a wise choice if you are willing to put everything on the line for a business that values improvement.
Potential Risks to consider before investing in a KFC franchising
You must keep in mind the following potential risks before you consider investing in a KFC franchises
- Supply chain disruption
- Possibility of backfiring of the franchise system
- Public perception of the fast-food industry in general and KFC
Such risks can end up weakening brand loyalty, and brand attractiveness, and reducing the overall revenues earned by the franchise.
Is the KFC Franchise Profit Worth the Cost?
Although the franchising cost might come out as being a little high for some people, still they can reap the benefits of a solid market position with KFC franchises. In some parts of the United States and the world, the terms “fried chicken” and “KFC” have come to mean the same thing.
KFC is a reliable franchisor, and depending on where you are, you could earn significantly more than the average sales.
KFC Franchise Success and Failure Rate
The below table will highlight the KFC franchising success and failure rate for the last 3 years. This will supplement your decision-making process.
Competition Analysis of KFC Franchises
|KFC||Cost to Franchise||Franchisee Fees||Royalty + Ad fees||Expected Profit||Recoup of Capital||FD Rating|
|KFC||$1,440,600 – $3,163,550||$45,000||4-5%+5%||9-14 years||4/5|
|Chicken Guy Franchise||$622,500 – $1,288,000||$20,000||6%+4%||–||–||3.3/5|
|Pluckers Franchise||$70,000 – $225,000||$25,000||2-3%+1-2%||–||–||3/5|
|Chicken Guy Franchise||$622,500 – $1,288,000||$20,000||6%+4%||–||–||3.3/5|
|Golden Chicken Franchise||$918,000 – $1,438,000||$ 30,000||4%+3%||–||–||3.7/5|
The FD rating for KFC franchising is 4.0/5.0.
Conclusion: Is the KFC franchise a good choice?
KFC is committed to improving people’s lives. They actively promote acceptance and diversity while assisting the local community in the fight against hunger. The business is also concerned about the environment and animal welfare, and it works to better both of these areas and lessen its environmental impact.
Franchisees are expected to be hands-on, but they are also viewed as valuable assets for the business and as members of the community. KFC aims to create a welcoming environment that can feel like home because they think comfort should go beyond the dinner table.
Establishing a KFC franchises might provide a more certain conclusion than making an investment in a brand that can struggle to succeed in a crowded and competitive market.
Entrepreneurs who want to open a franchise in the category franchise opportunities categories can look at
- Pluckers Franchise
- Raising Cane’s Franchise
- Chicken Salad Chick Franchise
- Dave’s Hot Chicken Franchise
- Chicken Guy franchise
- Halal Guy Franchise
- Golden Chicken Franchise
Frequently Asked Questions (FAQs)
- Is the KFC franchise profitable?
Yes, KFC franchises is a highly profitable franchises to invest in as a result of its brand image and reputation.
- Can you make money owning a KFC?
Yes, a franchising owner can make a considerable amount of money by owning a KFC franchises.
- Is a KFC a franchise?
Yes, KFC is a franchising business. They started franchising in 1952.
- How much is a KFC franchise?
A KFC franchising has an initial franchises fee of $45,000 and an initial investment of $1,440,600 – $3,163,550.
- How do KFC franchises make money?
KFC franchises make money by selling fried chicken and other delicacies along with great customer service to people.