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Description
Investment Icon

What Are the Initial Investment Requirements for a Charleys Franchise?

To open a Charleys franchise, you will need to prepare for a range of initial investment costs. The total investment can vary significantly, with a low end of approximately $202,059 and a high end reaching up to $935,700. This includes a franchise fee of $24,500, as well as ongoing expenses such as a 6% royalty fee and a 3% marketing fee. Additionally, prospective franchisees must demonstrate a net worth between $500,000 and $1,000,000 to qualify for ownership.

Fees Icon

What Is the Average Financial Performance of a Charleys Franchise?

Charleys franchises typically generate strong financial results, with an average annual revenue of $942,354 per unit. This performance is bolstered by a gross profit margin of 60%, allowing for a healthy EBITDA of approximately $188,470, which represents 20% of revenue. However, revenue can vary widely, with the lowest annual revenue reported at $146,455 and the highest reaching $3,166,966. Understanding these figures is crucial for evaluating the potential return on your investment.

Revenue Icon

How Quickly Can You Expect to Break Even with a Charleys Franchise?

Franchisees can anticipate a relatively quick breakeven period of around 12 months. This timeline is favorable compared to many other franchise opportunities, allowing new owners to recoup their initial investment efficiently. With an investment payback period of approximately 24 months, Charleys presents an attractive option for those looking to enter the franchise market with a solid plan for financial recovery.

Breakeven Icon

What Is the Growth Potential for Charleys Franchises?

Charleys has shown consistent growth in its franchise network, increasing from 496 franchised units in 2021 to 611 in 2023. This upward trend reflects the brand's expanding presence and popularity, indicating a robust market demand for its offerings. As Charleys continues to grow, franchisees may benefit from increased brand recognition and customer loyalty, enhancing their potential for profitability in the competitive food service sector.

Charleys 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.

Net Worth Required icon The minimum total assets (minus liabilities) you must possess.

i Net Worth Required:

$500,000 - $1,000,000
Investment Payback icon The estimated period to recoup your total investment.

i Investment Payback:

24 Months
Franchise Fee icon The initial fee paid to join the franchise system.

i Franchise Fee:

$24,500
Royalty Fee icon Ongoing percentage of revenue paid to the franchisor.

i Royalty Fee:

6%
Marketing Fee icon Regular contribution toward the franchise’s advertising fund.

i Marketing Fee:

3%
Breakeven Time icon The estimated timeframe to recover your initial costs.

i Breakeven Time:

12 Months
Initial Investment icon The total amount required to launch the franchise.

i Initial Investment:

$202,059 - $935,700
Cash Required icon The minimum liquid capital you must have on hand.

i Cash Required:

$202,059 - $935,700
Average Revenue icon The typical yearly revenue generated per franchise location.

i Average Revenue:

$942,354
Median Revenue icon The middle value of yearly revenue among franchise locations.

i Median Revenue:

$859,883
Highest Revenue icon The largest reported annual revenue among franchisees.

i Highest Revenue:

$3,166,966
Lowest Revenue icon The smallest reported annual revenue among franchisees.

i Lowest Revenue:

$146,455
Industry icon A broad sector defining similar types of franchise businesses.

i Industry:

Restaurant Franchises
Category icon A more specific division within the broader industry.

i Category:

Quick-Service Restaurants
Leadership icon The key individuals guiding the franchise’s strategy and growth.

i Leadership:

Charley Shin
Corporate Address icon The official business address of the franchisor’s headquarters.

i Corporate Address:

2500 Farmers Drive, Suite 140, Columbus, Ohio 43235
Funding Year icon Available financing options to help start the franchise.

i Funding Year:

1990
Parent Company icon The main organization that owns the franchise brand.

i Parent Company:

Gosh Enterprises Inc.

Charleys Franchise Unit Growth Summary

A breakdown of corporate, franchised, and total units, with yearly net changes.

The overall number of operating franchise locations.

Total Units i

672
The number of locations owned by independent franchisees.

Franchised Units i

611
The number of locations owned and run by the franchisor.

Corporate Units i

61
Units 2021 2022 2023
Total Units 551 599 672
Net Change YoY 48 73
Franchised Units 496 538 611
Net Change YoY 42 73
Corporate Units 55 61 61
Net Change YoY 6 0
Investment About

Investment Overview

Charleys is an appealing franchise opportunity with a low initial investment ranging from $202,059 to $935,700. This includes a franchise fee of $24,500, along with ongoing royalty and marketing fees of 6% and 3%, respectively. Potential franchisees should be prepared to meet a cash requirement between $202,059 and $935,700, and a net worth of $500,000 to $1,000,000 to qualify for ownership.

Potential About

Financial Performance

On average, Charleys units generate an impressive annual revenue of $942,354. The financial metrics indicate a gross profit margin of 60%, translating to a gross profit of approximately $565,412 per unit. With a breakeven time of just 12 months and an investment payback period of 24 months, Charleys presents a strong financial proposition for franchisees.

Metrics About

Franchise Growth

Charleys has demonstrated consistent growth in its franchise network, with 496 franchised units in 2021, increasing to 611 units by 2023. This growth reflects the brand's expanding market presence and its appeal among entrepreneurs looking for a profitable franchise model. The total units have grown from 551 in 2021 to 672 in 2023, showcasing robust franchise development.

Fees About

Operational Insights

Franchisees can expect annual operating expenses to total around $771,206, which includes lease expenses, salaries, insurance, and marketing. With a focus on maintaining operational efficiency, understanding these costs is crucial for maximizing profitability. The average cost of goods sold (COGS) is approximately $376,942, representing 40% of revenue.

Breakeven About

Support and Training

Charleys provides comprehensive support and training to its franchisees, ensuring they are well-equipped to manage their operations. This includes initial training programs, ongoing operational support, and marketing assistance. The franchise’s commitment to franchisee success is evident in its structured support system, which aims to foster a thriving business environment.

Units About

Brand Identity

Charleys is known for its fresh, high-quality cheesesteaks and other delicious menu offerings. The brand emphasizes a commitment to quality ingredients and exceptional customer service, creating a strong identity in the fast-casual dining sector. This focus on quality not only attracts customers but also builds loyalty, making Charleys a compelling choice for aspiring franchise owners.

Frequently Asked Questions

The initial investment for a Charleys franchise ranges from $202,059 to $935,700. This includes the franchise fee, equipment, leasehold improvements, and other startup costs.