Do you want to start a restaurant business by buying Pollo Tropical franchise? If YES, here is how much it cost to open a Pollo Tropical franchise.
Pollo Tropical is a quick-service restaurant known for its fresh chicken, marinated for 24 hours in a proprietary blend of citrus juices and spices. The restaurant places a huge emphasis on freshness and quality, with a focus on flavorful chicken served grilled or crispy. This company’s was established in 1988, but today this Miami-based Pollo Operations currently owns and operates over 150 locations throughout Florida.
How Much It Cost to Open a Pollo Tropical Franchise
- Financial Requirements
Pollo Tropical franchise candidates are expected to meet certain financial requirements, in this case, the startup cost. The startup cost consists of a liquid capital requirement starting from $1,500,000 to $5,000,000. The franchise candidates are also expected to have a net-worth requirement in the sum of $5,000,000.
Note that these startup costs are non-negotiable, and must be paid by the franchise candidate to qualify for ownership of this franchise opportunity. The Pollo Tropical Franchise mandates its franchisees to be committed to at least 5 restaurant developments.
Meanwhile, accurate data of the Pollo Tropical franchise’s franchise fee requirement are not available. However, it is believed that during the registration procedure, this information will be made available to the franchise candidate by the franchisor.
It’s also necessary to note that Pollo Tropical ongoing costs are more or less made up of the ongoing royalty fee paid to the franchisor. The franchisee is expected to always meet up with the ongoing costs remittances to the franchisor. The ongoing royalty fee amount to be paid by the franchisee depends solely on the franchise size.
Big sized franchises will attract bigger ongoing costs, while smaller sized franchises typically attract lower ongoing costs. Aside these financial obligations, all Pollo Tropical franchise candidates must demonstrate the following characteristics to be considered:
- Reasonable experience in high volume, multi-unit restaurant management. This may include hotel, contract feeding and catering or other hospitality industry experience. Five years or more is the benchmark. Ownership of the operations in question is not required but adds to the qualifications of the candidate. (If the candidate is a financial investor, an equity partner must fulfill this requirement.)
- Demonstrated experience and success in developing commercial and retail properties.
- Good credit and personal/business references.
- A business infrastructure able to support an investment and operation of the size at issue.
- Legally verifiable minimum net worth of $5 million US (greater for large territorial development agreements).
- Legally verifiable unencumbered liquid assets of $1.5 million US (greater for large territorial development agreements).
- Enough capital reserves available to fulfill the development opportunity.
Steps on How to Open a Pollo Tropical Franchise
To successfully acquire this franchise, below is detailed process provided by the company.
- Visit the franchisor’s website on https://www.pollotropical.com/franchising/our-process/ and click on the “our process” tab.
- Upon contacting the Pollo Tropical® International Development department, you will receive a set of introductory documents describing the company’s international program, the concept and the two-phase process followed in qualifying and awarding franchises.
- Once you meet the general requirements, a confidentiality agreement is executed. Further sharing of information beyond the overview documents noted above will not occur until this agreement is executed.
- Upon execution of the confidentiality agreement, an exchange of detailed information takes place: from Pollo Tropical, documents covering the business model and details of the investment as well as Development Agreement (DA) and Franchise Agreement (FA) templates are provided; all requested documentation will then be required of you. All information received by Pollo Tropical is kept strictly confidential.
- During this time frame, the head of franchising may visit the market to assess market conditions and to personally observe the operations (if applicable)
- At this point, you will be expected to provide all the information requested in PHASE TWO. Upon approval of the financial and operational requirements, a proposed DA term sheet (in some cases including a market penetration analysis) will be presented to you for review.
- A visit to Pollo Tropical headquarters and meetings with key department heads and executives then takes place. This important step is mandatory. During these meetings, you can have questions answered and to assess the support staff that will be involved in the business. Pollo Tropical executives take this opportunity to interview you in order to participate in the approval noted below.
- Immediately steps 1 through 6 have been completed, an approval package is assembled and presented to Pollo Tropical leadership for approval.
- Once it has been approved by Pollo Tropical leadership, executed copies of the DA will be sent to you for signatures. Upon full execution of these documents, you then become a Pollo Tropical developer. Once the first site is approved and construction begins, the FA is executed, you become then a Pollo Tropical franchisee.
This entire process can take as little as 60 days or as long as one year or more – depending on many factors, primarily your readiness and depending on local laws. Pollo Tropical have always stressed that it will not place any unreasonable obstacles in the way of a timely resolution of the approval process.
Pollo Tropical reserves all rights to add or remove markets from consideration. Pollo Tropical also reserves the right to approve or reject the candidacy of any person or business at its sole discretion.
The Pollo Tropical Franchise isn’t one of those opportunities where you can just diversify a portfolio to get more revenues coming in from different sources. This is a major investment opportunity that will take a lot of work to develop and grow over time.
Also, it’s not going to be for the average investor or small business entrepreneur. That’s the reason why the mandatory minimums are set at such a high level. The amount of net worth helps to provide another layer of proof that a potential franchisee has the proven experience that is needed to make the Pollo Tropical brand become #1 in the community where it is located.