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Bonchon Franchise ProfileRestaurant Franchises > Quick-Service Restaurants |
What is the Initial Investment for a Bonchon Franchise?
To open a Bonchon franchise, you should be prepared for a total initial investment ranging from $190,924 to $1,158,501. This includes a franchise fee of $35,000. Additionally, you will need to have at least $35,000 in cash available and a net worth between $500,000 and $1,500,000. Understanding these financial requirements is crucial for aspiring franchisees to ensure they are adequately prepared to embark on this business venture.
What are the Ongoing Fees for a Bonchon Franchise?
Bonchon franchisees are subject to ongoing fees that include a royalty fee of 5.00% of gross sales and a marketing fee of 1.50%. These fees are essential for maintaining brand presence and supporting marketing efforts. It's important to factor these costs into your overall financial planning to ensure the sustainability and profitability of your franchise unit.
What is the Average Revenue and Profitability for Bonchon Units?
Bonchon units generate significant revenue, with an average annual revenue of $1,628,081 per unit. The median annual revenue stands at $1,478,140, while the highest recorded annual revenue reaches $4,011,620. With a gross profit margin of 70%, franchisees can expect robust profitability, although operating expenses account for about 65% of revenue. Understanding these financial metrics can help franchisees gauge their potential earnings and manage operational costs effectively.
How Quickly Can You Expect to Break Even with a Bonchon Franchise?
The breakeven time for a Bonchon franchise is approximately 24 months, with an investment payback period of around 22 months. This relatively quick return on investment is appealing for many franchisees, as it indicates that they can start seeing profits within a reasonable timeframe. However, it's essential to have a solid business plan and operational strategy in place to achieve these timelines successfully.
Bonchon Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
Bonchon Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2021 | 2022 | 2023 |
|---|---|---|---|
| Total Units | 108 | 116 | 121 |
| Net Change YoY | 8 | 5 | |
| Franchised Units | 104 | 111 | 117 |
| Net Change YoY | 7 | 6 | |
| Corporate Units | 4 | 5 | 4 |
| Net Change YoY | 1 | -1 |
Initial Investment
The Bonchon franchise requires an initial investment ranging from $190,924 to $1,158,501. This investment covers various startup costs, including the franchise fee, equipment, and initial inventory. A cash reserve of at least $35,000 is also necessary to ensure smooth operations during the early stages.
Franchise Fees
To become a Bonchon franchisee, an initial franchise fee of $35,000 is required. Additionally, franchisees must pay a royalty fee of 5% on gross sales and a marketing fee of 1.5%. These fees contribute to the brand's marketing efforts and ongoing support provided to franchisees.
Financial Performance
Bonchon franchises have shown promising financial performance, with an average annual revenue of $1,628,081 per unit. The median revenue stands at $1,478,140, while the lowest recorded revenue is $163,657 and the highest reaches $4,011,620. This variability highlights the potential for profitability based on location and management.
Breakeven and Payback
Franchisees can expect to reach breakeven within approximately 24 months of operation. The investment payback period is estimated at 22 months, making Bonchon a relatively quick-return franchise opportunity compared to many others in the industry.
Unit Growth
Bonchon has experienced steady growth in its franchise units, increasing from 104 units in 2021 to 117 units in 2023. This upward trend indicates a strong demand for the brand and a growing market presence, which can be advantageous for new franchisees looking to enter a thriving system.
Average Operating Expenses
The average annual operating expenses for a Bonchon franchise range from $69,115 to $156,415. Key expenses include rent and utilities ($20,000 - $60,000), marketing and advertising ($5,000 - $10,000), and additional operating expenses. Understanding these costs is crucial for effective financial planning and management.
Frequently Asked Questions
The initial investment for a Bonchon franchise ranges from $190,924 to $1,158,501. This includes the franchise fee, equipment, and other startup costs.