|
Perkins Restaurant & Bakery Franchise ProfileFood Franchises > Casual Dining |
What is the Initial Investment for a Perkins Restaurant & Bakery Franchise?
The initial investment for a Perkins Restaurant & Bakery franchise ranges from $726,715 to $3,454,465. This includes a franchise fee of $40,000, along with other startup costs such as equipment, signage, and initial inventory. Aspiring franchisees should also be prepared to have liquid cash available between $100,000 and $150,000 to cover operational expenses in the early stages.
What Are the Ongoing Fees for a Perkins Franchise?
Franchisees of Perkins Restaurant & Bakery are required to pay a royalty fee of 4.00% of their gross sales. Additionally, a marketing fee of 3.00% is also applicable to help promote the brand and drive customer traffic. Understanding these ongoing costs is crucial for maintaining profitability and ensuring the long-term success of the franchise.
What Are the Financial Performance Metrics for Perkins Franchise Units?
On average, a Perkins Restaurant & Bakery franchise unit generates annual revenue of approximately $1,930,190, with a median revenue of $1,812,254. The breakeven time is estimated at 24 months, allowing franchisees to recover their initial investment relatively quickly. However, it's worth noting that the lowest annual revenue recorded was $69,129, while the highest reached $5,474,682, indicating variability in performance across different locations.
What Are the Requirements for Opening a Perkins Franchise?
To qualify for a Perkins Restaurant & Bakery franchise, prospective owners must meet a net worth requirement between $1,250,000 and $2,500,000. This ensures that franchisees have the financial stability to support their operations. Additionally, it is essential for new franchisees to undergo training and be committed to the brand's operational standards, which are designed to maintain quality and customer satisfaction across all locations.
Perkins Restaurant & Bakery 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:
Perkins Restaurant & Bakery 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 | 279 | 272 | 263 |
| Net Change YoY | -7 | -9 | |
| Franchised Units | 197 | 191 | 183 |
| Net Change YoY | -6 | -8 | |
| Corporate Units | 82 | 81 | 80 |
| Net Change YoY | -1 | -1 |
Investment Overview
The Perkins Restaurant & Bakery franchise requires an initial investment ranging from $726,715 to $3,454,465. This includes a franchise fee of $40,000. Franchisees should have cash reserves between $100,000 and $150,000 and a net worth of $1,250,000 to $2,500,000 to qualify for ownership.
Revenue Potential
Perkins franchises generate significant revenue, with an average annual revenue of approximately $1,930,190 per unit. The median revenue is slightly lower at $1,812,254, while revenues can vary widely, with the lowest reported at $69,129 and the highest at $5,474,682.
Franchise Performance
As of 2023, Perkins operates a total of 263 units, which includes 183 franchised locations and 80 corporate units. The franchise has seen a gradual decline in the number of units from 279 in 2021 to 263 in 2023, indicating a need for strategic growth initiatives.
Royalty and Marketing Fees
Franchisees are required to pay a royalty fee of 4% of gross sales, along with a marketing fee of 3%. These fees contribute to the overall support and brand recognition that Perkins provides to its franchisees, helping to drive customer traffic and sales.
Operational Insights
The average operating expenses for a Perkins franchise include costs such as rent (ranging from $20,000 to $60,000), utilities, and salaries, totaling between $726,715 and $1,995,465 annually. Understanding these expenses is crucial for effective financial planning and management.
Breakeven and Payback Period
Franchisees can expect to reach breakeven within approximately 24 months of operation. This timeframe aligns with the investment payback period, allowing owners to recoup their initial investment and start generating profit relatively quickly in the restaurant industry.
Frequently Asked Questions
The initial investment for a Perkins franchise ranges from $726,715 to $3,454,465, which includes various startup costs such as the franchise fee, equipment, and leasehold improvements.