Whether it's a restaurant, coffee shop, or bakery, franchise buyers are always on the lookout for brands that have the name recognition, products, and marketing chops to deliver sales at a scale that will enable them to run a local business that is profitable enough to make the investment worthwhile.
We analyzed hundreds of franchise disclosure documents of popular food service franchises to find the ones that deliver the greatest revenue for individual franchise owners. We've ranked the top 21 food and restaurant franchises based on average unit revenue (AUR), which gives potential franchisees a reasonable indication of how much money they can expect to generate in sales were they to open a new unit of their own. More on our methodology.
Our Methodology
The goal of any franchise owner is to run a profitable business. The franchise model is advantageous for restaurateurs because it offers a proven business model that can be opened in new markets with reasonable expectations of financial performance. While the performance of existing franchise units is not a guarantee that a new unit will perform as well, it is safe to use average unit revenues to compare different franchise opportunities.
Taking expected unit revenue in context with a thoughtful business plan to include expected operating costs and expenses can give entrepreneurs a methodology to compare potential profitability and return on investment of a given franchise venture.
In this report we rank franchises based on the average revenue generated by a single franchise unit or territory to highlight opportunities with the greatest sales potential.
What Is Average Unit Revenue?
Franchises report unit revenues in slightly different ways, but all generally refer to the total average sales of a single business unit, territory, or similar language that represents the exclusive market of a franchise owner.
Where Does the Data Come From?
The FTC's franchise rule permits franchisors to provide information on actual or potential franchise revenue of franchisee and/or corporate owned units. While franchises are not legally required to report average unit revenue, most do in Item 19 of the Franchise Disclosure Document. This allows potential franchisees to estimate the volume they may expect from opening a new franchise business.
How Do We Measure It?
We use data provided by the franchisors in the Franchise Disclosure Document (FDD). As much as possible, we look for revenue of franchised units rather than corporate owned units. Often this data is directly available based on a subset of franchise units that are representative of typical unit performance. In some cases, we may derive average unit revenue from corporate royalty revenue and number of total franchise units.
The following table includes notes from the FDD on the source of AUR provided.
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Chick-fil-A
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Based on 2,107 reporting franchise locations open for at least one full year
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Golden Corral
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Based on 192 "GC-11M" design locations open all year
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Buffalo Wild Wings
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Based on 521 reporting franchise locations open for at least one full year
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Culver's ButterBurgers & Frozen Custard
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Based on 828 reporting franchise locations open for at least one full year
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Mr. Gatti's Pizza (Dine-In)
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Based on 21 reporting franchise locations open for at least one full year
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McDonald's
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Based on 12,400 franchise locations open for at least one full year
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Zaxby's
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AUR is for all 736 franchise locations open for at least one full year
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Paris Baguette
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Based on 63 reporting franchised units
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Pizza Ranch
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Based on 57 reporting franchise locations with a "Fun Zone" open all year
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Wendy's
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AUR is for all 5,313 Franchise locations open for at least one full year
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McAlister's Deli
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Based on 431 traditional franchise locations open for at least one full year
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Crumbl Cookies
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AUR is for all 324 franchise locations open for at least one full year and within a population of 40k - 120k
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Popeyes Louisiana Kitchen
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Based on 2,080 reporting franchise locations open for at least one full year
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Jack in the Box
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Based 1,940 reporting franchised units
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Denny's
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Based on 1,331 domestic traditional restaurants open for at least one full year
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Del Taco
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AUR is for 278 franchised freestanding locations open for at least one full year
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Sonic Drive-In
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Based on 3,133 franchise locations open for at least one full year
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Wing-Stop
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Based on 1,410 franchise and 37 company locations open for at least one full year
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Beef O Brady's
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Based on 104 mature franchise locations
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Dunkin'
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Based on 2,841 free-standing franchise drive-thru restaurants open for at least one full year
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Burger King
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AUR is for 6,243 traditional franchise locations open all year; AUR for 790 non-traditional locations is $1,178,750; Weighted average for 7,033 traditional and non-traditional locations is $1,471,260
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Why It's Important
Sales or revenue volume is central to determining the financial viability of a franchise investment. Expected unit revenues combined with a reasonable estimate of operating expenses can help potential franchisees determine the return on their initial investment, and the potential earnings of a franchise opportunity. To learn more about researching franchises, see the articles in our Franchise Learning Center.
Want to see more food and restaurant franchises actively opening in new markets? See our Franchise Directory.
