Discover the top franchises with the highest ongoing royalty fees in the United States. Learn about the costs and benefits of investing in leading brands like Chick-fil-A, Firehouse Subs, and KFC.
The franchise with the highest ongoing royalty fee in the United States is Chick-fil-A. It charges a 15% royalty fee on gross sales, along with 50% of pretax profits. This structure makes Chick-fil-A one of the most expensive franchises in terms of ongoing fees .
Here are some of the top franchises with the highest ongoing royalty fees:
1. Chick-fil-A
- Royalty Fee: 15% of gross sales plus 50% of pretax profits.
- Details: Chick-fil-A is known for its rigorous selection process and high operational standards
2. Firehouse Subs
- Royalty Fee: 6% of sales.
- Details: In addition to the royalty fee, franchisees are required to spend between 3% and 5% of sales on advertising
3. Taco Bell
- Royalty Fee: 5.5% of sales.
- Details: Part of Yum! Brands, Taco Bell requires a significant initial investment and has substantial ad royalty fees as well
4. KFC
- Royalty Fee: 5% of sales.
- Details: Another franchise under the Yum! Brands umbrella, KFC also has substantial initial investment requirements
5. McDonald’s
- Royalty Fee: 4% of sales.
- Details: Known worldwide, McDonald’s has a slightly lower royalty fee compared to others on this list but compensates with high advertising fees
6. 7-Eleven
- Royalty Fee: Variable, generally high.
- Details: The royalty fee structure for 7-Eleven can be complex and varies depending on the store’s location and sales
These franchises demand high ongoing fees but offer substantial brand recognition and support, making them attractive despite the high costs.