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Lee's Famous Recipe Chicken Franchise ProfileRestaurant Franchises > Quick-Service Restaurants |
What are the Initial Investment Requirements for a Lee's Famous Recipe Chicken Franchise?
To open a Lee's Famous Recipe Chicken franchise, you should prepare for an initial investment ranging from $499,700 to $2,049,400. This includes a franchise fee of $35,000. Additionally, you will need to have cash readily available between $35,000 and $40,000, and your net worth must fall between $499,700 and $821,300. Understanding these financial commitments is crucial for aspiring franchisees to ensure they are adequately prepared for this venture.
What are the Ongoing Fees and Financial Performance Metrics?
Franchisees of Lee's Famous Recipe Chicken are required to pay a royalty fee of 4% and a marketing fee of 2%. The average annual revenue per unit is approximately $1,798,722, with a median revenue of $2,639,531. The financial performance can vary significantly, with the lowest annual revenue reported at $784,172 and the highest at $6,184,146. This data is vital for potential franchisees to assess their expected return on investment and overall profitability.
What is the Expected Breakeven and Investment Payback Period?
Lee's Famous Recipe Chicken franchisees can expect to break even within approximately 12 months of operation. Furthermore, the investment payback period is estimated at 18 months. These timelines are important for potential franchisees to consider as they plan their financial strategies and set realistic expectations for their business's performance.
How Many Franchise Units Does Lee's Famous Recipe Chicken Operate?
As of 2023, Lee's Famous Recipe Chicken operates a total of 123 units, with 106 of those being franchised and 17 corporate-owned. The number of franchised units has seen a decline from 124 in 2021 to 106 in 2023, which indicates a need for potential franchisees to evaluate market conditions and the brand's growth trajectory. Understanding the unit distribution can help investors make informed decisions about entering the franchise system.
Lee's Famous Recipe Chicken 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:
Lee's Famous Recipe Chicken 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 | 128 | 126 | 123 |
| Net Change YoY | -2 | -3 | |
| Franchised Units | 124 | 114 | 106 |
| Net Change YoY | -10 | -8 | |
| Corporate Units | 4 | 12 | 17 |
| Net Change YoY | +8 | +5 |
Company Background
Lee's Famous Recipe Chicken is a well-established quick-service restaurant chain specializing in fried chicken and home-style meals. Founded in 1966, Lee's has built a reputation for its unique, flavorful chicken recipes and commitment to quality. With locations primarily in the Midwest and Southeast, the brand has expanded to over 100 franchised units, offering customers a comforting dining experience that reflects traditional Southern hospitality.
Franchise Opportunity
Investing in a Lee's Famous Recipe Chicken franchise offers aspiring entrepreneurs a chance to be part of a recognized brand with a loyal customer base. The franchise model is designed to support franchisees with comprehensive training, marketing assistance, and operational guidance. With an average annual revenue per unit of approximately $1.8 million, franchisees can tap into a thriving market while enjoying the benefits of being part of a well-respected chain.
Investment Requirements
The initial investment to open a Lee's Famous Recipe Chicken franchise ranges from $499,700 to $2,049,400, which includes a franchise fee of $35,000. Prospective franchisees should have a cash requirement of $35,000 to $40,000 and a net worth between $499,700 and $821,300. This financial structure ensures that franchisees are adequately prepared to launch and sustain their business effectively.
Royalties and Fees
Lee's Famous Recipe Chicken charges a royalty fee of 4% on gross sales, along with a marketing fee of 2%. These fees contribute to the overall brand strength and marketing initiatives that drive customer traffic and sales, allowing franchisees to benefit from a unified brand presence and promotional efforts.
Financial Performance
The average annual revenue for a Lee's Famous Recipe Chicken unit is reported at $1,798,722, with a median revenue of $2,639,531. Franchisees can expect a breakeven time of approximately 12 months and an investment payback period of 18 months, making it a potentially lucrative opportunity for those who effectively manage their operations.
Corporate Structure
Lee's Famous Recipe Chicken operates under a franchise model with a mix of franchised and corporate-owned units. As of 2023, there are 106 franchised units and 17 corporate units. This structure allows the brand to maintain a strong presence in the market while providing franchisees with the support and resources needed to succeed in the competitive fast-food landscape.
Frequently Asked Questions
The initial investment for a Lee's Famous Recipe Chicken franchise ranges from $499,700 to $2,049,400, which includes the franchise fee and other startup costs.