Five Guys is a family owned business that was started near Washington, D.C. in 1986 by the Murrell family. It was named after the five sons of the family. Five Guys currently operates in more than 1,400 locations. It is spread not only across 49 states of USA, but it has also established its presence in nine countries across the world. In 2003 Five Guys began franchising their business and in 18 months, they had sold over 300 units. Five Guys primarily specializes in burgers. The twist being that each burger is customized to taste of the customer. They claim that there are 250,000 different ways to make a burger and that is what they try to achieve everyday with their humungous list of ingredients.
Here are some details of a Five Guys Franchise to take note of:
Why take a Five Guys franchise?
Five Guys is a pioneer brand in burgers and fast food. Even though their menu hasn’t changed much over the years, the growth of their customer base has been immense. Five Guys has been received several awards and accolades over the years. In 2013, they won the Burger Chain Honor award leaving behind competitors and major brands like Smashburger, In-and-Out, and Shake Shack.
In 2017, the company’s first quarter income was estimated to be around $388.09 million. Five Guys is a total package. You gate a well-built brand, constant support and training, and a wide consumer base.
How to Apply for Five Guys Franchise?
Applying for a franchise is simple.
You can simply fill the form here: http://www.fiveguys.com/Contact-Us# and you will be contacted back by the Five Guys team.
Please note that Five Guys is currently not open to franchise opportunities in the UK. The form shows a list of countries where they are offering franchises at the moment.
What Training or Support will I receive with the Five Guys Franchise?
Normally the initial training program is for two weeks but it could be extended up to six weeks. The Five Guys franchisor will provide you with all the training material. This training is specifically designed for the franchisee’s General Manager, and one Assistant Manager with no extra charges. At an additional charge $1,500 per person, you can have other staff trained by the franchisor as well. A trained representative of Five Guys will also provide on-site training, supervision, and general management support for the initial 10 days. They may also provide extra trained representatives for further on-site training to the staff if necessary.
Five Guys Franchise Cost Information
Here is list of all costs in dollars. As Five Guys is currently not offering a franchise in the UK, these costs are US based but can be used as an estimate:
|Name of Fee||Low||High|
|Initial Franchise Fee||$25,000 or €22394.50 EUR||$25,000 or €22394.50|
|Development Fee||$50,000 or €44789.00||$125,000 or €111972.50 ( in Alaska, Hawaii & Puerto Rico)|
|Leasehold Improvements||$100,000 or €89578||$300,000 or €268734|
|Lease Payments and other rental expenses||$7,500 or €6718.35||$20,000 or €17915.60|
|Equipment||$55,000 or €49267.90||$105,000 or €94056.90|
|Signage||$6,500 or €5822.57||$20,000 or €17915.60|
|Initial Inventory||$10,000 or €8957.80||$15,000 or €13436.70|
|Architectural/Engineering||$7,000 or €6270.46||$25,000 or €22394.50|
|Electronic Cash Register System with Modem||$15,000 or €13436.70||$25,000 or €22394.50|
|Facsimile Machine||$350 or €313.52||$500 or €447.89|
|Travel, lodging and meals for initial training||$100 or €89.58||$5,000 or €4478.90|
|Business Supplies (stationery, business cards, menus, gift cards, paper and other materials)||$4,000 or €3583.12||$8,500 or €7614.13|
|Business licenses, permits, utility deposits, etc. (for first year)||$5,000 or €4478.90||$15,000 or €13436.70|
|Delivery and catering expenses||0||$1,000 or €895.78|
|Insurance deposits and premiums||$750 or €671.84||$1,250 or €1119.73|
|Additional Funds for first 3 months||$20,000 or €17915.60||$25,000 or €22394.50|
|ESTIMATED TOTAL||$306,200 or €274287.84||$641,250 or €574418.93|
|ESTIMATED TOTAL for Alaska, Hawaii & Puerto Rico||$381,200 or €341471.34||$716,250 or €641602.43|
What are the other fees?
Apart from the initial investment, these are some other fees:
|Type of Fee||Amount|
|Royalty Fee||6% of Gross Sales. If the Restaurant is located in Alaska, Hawaii or Puerto Rico, the Royalty Fee is 8% of Gross Sales.|
|Creative Fund||Up to 2% of Gross Sales. (Currently 2%)|
|Bread Products||Varies, depending on franchisee’s bread product needs.|
|Local Advertising||Not less than 2% of Gross Sales.|
|Cooperative Advertising||Maximum – 1.5% of Gross Sales, which will be credited towards Local Advertising.|
|Advertising and Promotional Materials||Varies, depending on franchisee’s advertising needs.|
|Interest||The lesser of (i) 10% per annum or (ii) the maximum rate allowed by applicable law.|
|Advertising & Promotional Materials||Varies, depending on franchisee’s advertising needs|
|Prohibited Product or Service Fine||$250 or €223.94 per day of use of unauthorized products or services.|
|Initial Training of additional or replacement and successor personnel||$1,500 or €1343.67 per person.|
|Additional Assistance||If franchisee requests additional assistance, he or she must pay the current per diem charge for Five Guys employees used to provide the assistance and our associated costs. Current per diem is $500 or €447.89.|
|Cash Register Upgrades||Approximately $5,000 or €4478.90|
|Transfer Fee||$5,000 or €4478.90 to reimburse Five Guys for reasonable costs and expenses in reviewing the transfer application.|
|Public Offering||$5,000 or €4478.90 to reimburse Five Guys for reasonable costs and expenses in reviewing the proposed securities offering.|
|Additional or Remedial Training||Cost in providing the training (Currently $1,500 or €1343.67)|
|Inspection and Testing||Cost of inspection or testing. (Currently estimated at $5,000 or €4478.90)|
|Vendor/Equipment Approval Fee||$5,000 or €4478.90 to reimburse Five Guys for reasonable costs and expenses in reviewing and approving vendor equipment.|
|Audit Fee||Cost of audit (Currently estimated at $5,000 or 4478.90).|
|Late Payment or Reporting Fee||$50 or €44.79 per day the franchisee is late.|
|Site Evaluation Fee||A reasonable amount to be determined. (Currently $500 or €447.89)|
|Relocation Fee||$7,500 or €6718.35 to reimburse Five Guys for its time, costs and expenses in reviewing the relocation application as well as the current and future sites.|
|Gift Card Program||Varies|
|Time Extension Fee||$10,000 or € 8957.80 per Time Extension.|
Five Guys Franchise Contact Information
You can simply fill the form here: http://www.fiveguys.com/Contact-Us# and you will be contacted back by the Five Guys team. You can also call up on their 24 Hour Customer Feedback Hotline 866-345-GUYS (4897)
Frequently Asked Questions
- Does Five Guys offer Financial Assistance?
Five Guys does not offer any financing assistance to franchisees.
What are the terms of Agreement and Renewal?
The franchise term is ideally for 10 years from the date of the Franchise Agreement. It could also be terminated earlier. The Agreement can further be renewed for another five-year term.
Are there any Obligations and Restrictions?
It is important to note:
- If the franchisee is an individual, they must perform all obligations of the Operating Principal. In case of a corporation, partnership or other entities, the Operating Principal must be one of the “Controlling Principals” and must continue to hold ownership interest in the franchise or any entity that directly or indirectly controls the franchise.
- The general manager of the store should meet the educational and business eligibility of Five Guys.
- You must obey Five Guys specifications pertaining to all food and beverage items, ingredients, supplies, materials, fixtures, furnishings, equipment, utensils and any other kitchen item that is sold or used at the restaurant. This also includes the cash register and other computer hardware and software.
- With regards to sales, you must keep in mind the style and fashion of Five Guys.