Do you want to start a restaurant business by buying Popeye’s franchise? If YES, here is how much it cost to open a Popeye’s franchise and their requirement.

Popeyes Restaurants are quick service restaurants that offer a limited menu of lunch, dinner and breakfast products in certain Restaurants. Popeyes sets itself apart with a unique “Louisiana” style menu that features spicy chicken, chicken tenders, biscuits, fried shrimp and other seafood, red beans and rice and other quick-service menu items.

How Much It Cost to Open a Popeye’s Franchise

  • Financial Requirements

This unique franchise opportunity enables owners to specialize and serve a delicious menu selection of chicken. Note that this business is not ideal for those wishing to break into a health conscious business; Popeyes makes no apologies for their tasty morsels. According to the company’s FDD, below are the financial obligations attached to acquiring a Popeyes Franchise.

  1. Franchise Fee: $50,000

You are mandated under the Franchise Agreement to pay Popeyes a $50,000 franchise fee for each Restaurant before opening the Restaurant. The Franchise Fee is not credited against any other fee, is not payable in installments, and is not refundable.

2. Development Fee: $50,000 multiplied by the number of net new Restaurants that you are required to develop and have open for business before the last day of that year

  • Except as described below, you’re expected to sign a Development Agreement regardless of the number of Restaurants you commit to develop.
  • When you sign the Development Agreement and on or before January 1 of each year thereafter, you’re expected to pay to Popeyes an amount equal to $50,000 multiplied by the number of net new Restaurants that you are required to develop and have open for business before the last day of that year (each such fee is a “Franchise Fee Prepayment”).
  • When you sign each Franchise Agreement, Popeyes will apply $50,000 from the previously made Franchise Fee Prepayment towards the Franchise Fee owed by you for the applicable Restaurant until the full amount of the Franchise Fee Prepayment is applied.

3. Royalty: 5 percent of Gross Sales

  • Due Date: Weekly on Gross Sales for the prior week. Gross Sales means all revenue related to the Restaurant, less sales taxes.

4. Advertising Fund Contribution: 4 percent of Gross Sales

  • Due Date: Same as royalty.
  • Popeyes may reduce or waive the Advertising Fund Contribution for restaurants located in Alternative Venues.

5. Advertising Co-op: Presently 0.25 percent to 2.6 percent of Gross Sales as established by Local Advertising Co-op (in addition to Advertising Fund Contribution)

  • Due Date: Same as royalty.
  • The exact amount of the contribution to the Co-op will be determined by a vote of its members; when added to the Advertising Fund Contribution, the total will not be less than 4 percent of Gross Sales.

6. Audit: Cost of audit

  • Due Date: If incurred, on demand.
  • If Popeyes audits you and finds that you understated Gross Sales by 2 percent or more, you’re expected to reimburse it for the cost of the audit.

7. Costs and Attorneys’ Fees: Popeyes’ costs and expenses

  • Due Date: Immediately, if incurred.
  • Costs and attorneys’ fees are payable if Popeyes terminates the Franchise Agreement because of your default.

8. Guest Recovery Fee: varies

  • Due Date: If incurred, on demand.
  • You are expected to reimburse Popeyes the costs it has incurred based on the number and type of guest complaints received by the guest relations platform with respect to your Restaurant.

9. Indemnity: The losses and expenses Popeyes incurs

  • Due Date: If incurred, on demand.
  • You’re expected to indemnify and reimburse Popeyes for its costs and any judgment if it is sued for claims relating to the operation of your Restaurant.
  • You’re expected to also reimburse Popeyes for costs it incurs in enforcing the agreements if you default or if you sue it (unless you are found to be in compliance with the agreements).

10. Insurance: Cost of obtaining coverage, plus interest and a reasonable administrative fee that Popeyes will set

  • Due Date: If incurred, on demand.
  • If you do not obtain or maintain insurance coverage and Popeyes purchases coverage on your behalf, you’re expected to reimburse it.

11. Interest on Overdue Payments: 5 percent per month or the maximum rate permitted by law, whichever is less

  • Due Date: If payments are more than 7 days overdue, on demand.
  • Interest on late payments runs from the date you should have made your payment until the date it is received by Popeyes.

12. Interest on Understated Sales: 5 percent per month or the maximum rate permitted by law, whichever is less.

  • Due Date: If incurred, on demand.
  • Interest on underreported sales runs from the date you should have made your payment until the date you pay Popeyes.

13. Returned Payment Fee: $35 per returned payment

  • Due Date: If incurred, on demand.
  • Each payment you make or that Popeyes drafts in accordance with its policies and/or your agreements that is returned for insufficient funds or otherwise not honored by your bank will be assessed a fee (or the maximum fee allowable by law).

14. Product Testing, Inspections, and Approval: costs for testing new products and inspecting new suppliers

  • Due Date: If incurred, on demand.
  • If you request approval to purchase ingredients, supplies, and goods from suppliers that Popeyes has not approved, you’re expected to pay the actual cost and expenses it incurs for inspecting the supplier’s facility and testing ingredients, supplies, and goods.

15. Renewal: 50 percent of Popeyes’ then-current standard initial franchise fee

  • Due Date: Upon signing the Franchise Agreement for the renewal term.
  • Renewal is subject to contractual requirements.

16. Supplemental Term Option: 50 percent of Popeyes’ then-current standard initial franchise fee

  • Due Date: Upon signing the Franchise Agreement for the supplemental term.
  • This fee covers both (i) the purchase of the supplemental option and (ii) the exercise of the supplemental 10-year renewal term. Renewal is subject to contractual requirements.

17. Securities Offering Review Fee: $5,000 or a greater amount, if necessary, to reimburse Popeyes for its out-of-pocket costs and expenses in connection with reviewing your proposed securities offering.

  • Due Date: Upon request for review.

18. Trade Secret Products: Approximately $3,000 initially; approximately $3,000 per month when in operation

  • Due Date: As arranged.
  • You may buy certain Trade Secret Products only from a vendor that Popeyes designates (the vendor is currently Diversified Foods and Seasonings, Inc.)

19. Transfer: $5,000 to $7,500, depending upon the year of the Franchise Agreement being transferred

  • Due Date: Before transfer.
  • No transfer fee is required if the transfer is to a corporation or other business entity of which you own 100 percent and such entity was formed for convenience of ownership.

20. Impact Study: An amount up to $4,000 to $6,000 per study

  • Due Date: If incurred, on demand.
  • In connection with reviewing a proposed site, which could have impact on other franchised locations in close proximity to the proposed site, an impact study may be requested to further consider approval of the site.

21. Background Check Fee: $280 to $15,000

  • Due Date: As incurred, on demand.
  • Typically $280 for U.S. applicants, $1,000 to $15,000 for international investors.

22. Training Platform Maintenance Fee: $300 every six months

  • Due Date: On demand.
  • Each restaurant contributes a bi-annual training fee for access, use, and support of the training platform.

Steps on How to Get or Open a Popeyes Franchise

Although, acquiring a Popeyes franchise requires a relatively large initial investment, the amount of profit that you can bring in on a regular basis can make it worth your while. Once you’ve determined from the information above that you can meet the minimum financial requirements to become a franchisee. Then complete the request information form on the company’s website and submit to Popeyes. Popeyes will then contact you;

1. Once the company decide to proceed, then the company will need a completed Corporate International Application Form. They will email this form for you to complete and return. It requests basic information that tells the company about the people or company interested in franchising Popeyes internationally.

2. Once it has been determined that you meet the financial requirements and the area in which you wish to develop is available, you will then be considered an applicant for franchising with Popeyes. Whereupon, you will be contacted by a member of the company’s New Business Development Team who will help guide you through the remainder of the process.

3. Once a member of the New Business Development Team has contacted you and approved you to move forward in the franchising process, you will need to complete the following items (it is not necessary to complete the following items until you have been approved to move forward). This list is not all-inclusive and is provided to potential franchisees as a guide. Completing the required steps does not guarantee acceptance into the Popeyes franchising system.

  • Company & Personal Financial Statements, Store Income Statements—(P&L) (Latest Annual & Interim)
  • Business Operating Plan, Resume/Brief Biography

4. Before the company enters into a Development Agreement with you, they may be required to complete certain registration and disclosure processes as required by the governing authorities in your area of interest.

Popeye’s Franchise Requirement, Terms and Conditions

Franchisees will operate a quick-service restaurant specializing in the sale of fried chicken, seafood and other quick service food under the name “Popeyes Louisiana Kitchen.” To qualify for a Popeyes franchise, some of your management employees are mandated to complete the Popeyes Training Program.

If the Restaurant is the franchisee’s first Popeyes Restaurant, then before the franchisee opens or takes possession of the Restaurant, a minimum of five of the designated management employees, including the Key Operator, must complete PTP for their applicable management role at the Restaurant.

PTP can last as long as six to ten weeks, the first two to four weeks of which consist of an orientation and team member station training until the trainee meets the parent company’s proficiency standards. The next four to six weeks will cover leadership training as well as training modules for a restaurant general manager, assistant restaurant general manager, and shift manager.

The length of the initial franchise term is 20 years from the date of commencement of operation of the Restaurant. One renewal term of 10 years, subject to contractual requirements is available, as well as an option to buy up to one additional 10 year “Supplemental Renewal Term.”

As a franchisee with Popeyes Restaurant, once you sign a Franchise Agreement for a Restaurant that is not an Alternative Venue, you will be granted a geographic area within which the parent company will not open, nor license anyone other than your own restaurant.

The Protected Area will consist of an area equal to the lesser of: (1) a 1 mile radius around the Restaurant; or (2) an area surrounding the Restaurant encompassing a population (residential and/or daytime/commercial) of 50,000 people.

The limited exclusivity granted in the Protected Area does not apply to: (a) existing Restaurants, (b) any closed Restaurants that may re-open within three years from the closing date of such restaurant; and (c) Restaurants for which Franchise Agreements were previously granted.

The parent company also maintains the right periodically to reduce or modify the Protected Area to reflect population shifts. If more than one individual or a legal entity such as a corporation, partnership or Limited Liability Company owns the franchise, the franchisee must designate and retain an individual to serve as the Managing Director of the Restaurant.

If franchisees are an individual that owns the franchise, the parent company recommends (but does not require) that they be the Managing Director. The Managing Director must be approved by the parent company and must have at least a 5 percent legal or beneficial ownership interest in the franchise or the right to receive 5 percent or more of the operating profits of the Restaurant.

The Managing Director must have full control over the day-to-day operations of the Restaurant and any other Popeyes Restaurants owned by the franchisee located in the same geographic area. The Restaurant must at all times be under the direct, on-premises supervision of a Popeyes Certified Manager.

Joy Nwokoro