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Business Franchises

Wendy's Franchises Save Money by Focusing on Web Operations

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Dave Thomas' dream was to provide value, taste and options to his chain of restaurants. After working as a KFC franchisee for a couple of decades, Thomas decided to go it alone with the opening of his first Wendy's restaurant in 1969.

Seeing the potential to franchise his chain Thomas made franchising available in 1972 and Wendy's, as an entity, has never looked back.

Costs

Start up costs on a Wendy's franchise is not cheap, in fact, it might be a little higher than a few of the major franchises out there. If one were to consider buying the land required for their building and starting a franchise from scratch, the price tag could run as high as $1.9 to $3.3 million dollars. One the low end, those wishing to lease and add a building might be looking in the range of around $300,000 to $500,000.

The thing to remember is that this price tag includes everything to get one started down the road.

Inclusion

Wendy's requires new franchisees to attend a 5 to 5 ½ month course of study; one of the most intensive programs of all franchises. The goal is to maintain the Wendy's standard and leverage the franchisee's chances of success. During this training, franchisees (or their representatives) will learn how to be successful from a financial and quality assurance stand point.

Remember, Wendy's cooks their food to order, so knowing their process is important to the success of the franchise as a whole. The startup estimate also includes the cost of advertising, payroll for the first few months, and the actual food and supplies needed to start.

Long term costs

Wendy's requires a royalty fee of 4% of gross, or $1,000 a month, whichever is greater, and it doesn't end there. Franchisees are expected to pay in a little over 3% of gross for National advertising and .75% for local. So your average monthly contribution to the Wendy's franchise could be as high as 8% of your gross sales.

The good news is Wendy's has a long track record of advising the prospective franchisee on location and best practice, which again, helps ensure the new franchisee's success.

Cons

While 8% of gross might not seem too bad of a price to pay, there are other factors to consider when seeking a Wendy's franchise. Here are a few items that might not sit well with everyone:

With over 6,500 nationally, Wendy's is a fair bit smaller than some of their competition (MacDonald's boasts over 14,000 stores in the US and 25,000 Subway sandwich shops). The quality and dining experience Wendy's offers is, however, as unique and filled with quality as it beloved founder. While a bit pricier than some other chains, Wendy's has a franchise program second to none.

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