Liquid Capital: $750,000+
Net Worth Requirement: $1,500,000
Investment: $575,600 – $3,370,100
Franchise Fee: $25,000 – $45,000
Units in Operation: 7,500+
Founded: 1962
Franchising Since: 1964
TACO BELL FRANCHISE: COSTS, FEES & EARNING STATS
Taco Bell was founded in 1962 by Glen Bell in Downey, CA and he began franchising in 1964. The company has since expanded to over 7,000 locations worldwide.
The Mexican-inspired fast-food restaurant is well-known for its tacos, nachos, burritos, and Crunch Wrap Supreme.
In recent years, Taco Bell restaurants have been working to attract a wider audience by offering healthier options. Some of those options include vegetarian and vegan items at Taco Bell restaurants.
In this article, we will discuss the cost, fees, and earnings statistics of Taco Bell franchise locations.
IS TACO BELL A FRANCHISE OR CHAIN?
Taco Bell Corp. is a fast-food franchise that specializes in Mexican-inspired cuisine. Taco Bell is owned by Yum! Brands, Inc., the same company that owns KFC and Pizza Hut. As a result, Taco Bell is often referred to as part of the “Yum! Brands family”.
There are many differences between Taco Bell and other Yum! Brands locations and restaurants. For example, Taco Bell locations are generally smaller and focus more on drive-thru service.
In addition, Taco Bell offers a wider variety of menu items than KFC or Pizza Hut. As a result, Taco Bell has carved out a distinct identity within the Yum! Brands restaurant family. TACO BELL FRANCHISE: COSTS, FEES & EARNING STATS
HOW MANY TACO BELL FRANCHISES ARE THERE?
There are currently over 7,500 Taco Bell stores worldwide. Most of these restaurants are located in California, Texas, Florida, and Ohio, with the United States having the most stores.
In addition to traditional fast-food, Taco Bell also offers a variety of unique menu items, such as Doritos Locos Tacos.
The franchise has expanded to nearly 30 countries worldwide. This international presence is another big sign of the brand’s continued success.
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HOW MUCH DOES IT COST TO OPEN A TACO BELL FRANCHISE?
If you’re thinking about opening a Taco Bell, there are a few things you need to know. The cost of a Taco Bell franchise can range between $575,600 – $3,370,100 and even more. However, this figure varies based on the restaurant’s location and building size, as well as construction, equipment, and inventory. It also includes costs associated with training new employees and marketing the restaurant. TACO BELL FRANCHISE: COSTS, FEES & EARNING STATS
Taco Bell’s requirements for opening a franchise are a net worth of $1.5 million and liquid assets of $750,000. You’ll have to pay an ongoing royalty fee, which is 5.5%, and an advertising fund fee of 4.25% on gross sales.
Of course, these are just some of the costs associated with opening a Taco Bell – you also have to factor in things like employee salaries, marketing, and other operating expenses.
Taco Bell is one of the most popular fast-food franchises and their products are in great demand. If you are a fan of Mexican food and have the financial resources to pursue your venture, then a franchise could be a great opportunity for you.
What is the Taco Bell franchise fee?
| Name of Fee | Low | High |
| Background Check Fee (per person) | $500 | $700 |
| Initial Franchise Fee | $25,000 | $45,000 |
| First Unit Construction Services | $27,250 | $27,250 |
| Optional Real Estate Services | $10,000 | $37,250 |
| Permits, Licenses, Security Deposits | $74,000 | $125,000 |
| Real Property | $45,000 | $1,400,000 |
| Building/Site Construction | $177,000 | $1,700,000 |
| Equipment/ Signage/ Decor/ POS | $200,000 | $570,000 |
| Initial Inventory | $7,000 | $10,000 |
| Grand Opening Expense | $5,000 | $5,000 |
| Additional Funds – 3 months | $40,000 | $60,000 |
| ESTIMATED TOTAL* | $610,750 | $3,980,200 |
Purchase of Existing Restaurants from the Franchisor or an Affiliate
| Name of Fee | Low | High |
| Initial Franchise Fee | $25,000 | $45,000 |
| Building, Equipment, Signs and Inventory | $150,000 | $1,755,000 or more |
| Any Leasehold or Other Real Property Interests | Varies | |
| TOTAL PURCHASE PRICE | $175,000 | $1,800,000 or more |
Other Fees
| Type of Fee | Amount |
| Grand Opening Expense | $5,000 to be spent by franchisees for advertising and promoting the opening of the unit. |
| Period Franchise Fee | 5.5% of the unit’s gross sales. |
| Period Marketing Fee | 4.25% of the unit’s gross sales. |
| Late Charges | The lesser of 18% per annum or the highest rate permitted by New York law, plus the then-customary administrative charge. |
| Digital Transaction Fee for Mobile, Web, Kiosk, Connect Me Drive Thru & Delivery Orders | $0.19 per digital transaction. |
| Gift Card Transaction Fee | $0.19 per gift card transaction. |
| Additional Trainee Fee | $350 per person. |
| Training Materials | As established by the franchisor. |
| Cost of Audit of the Franchisee’s Books | Any and all costs incurred in connection with the inspection or audit, including reasonable accounting and legal fees. |
| Transfer Fee | A transfer of all or a portion of the franchisee’s interest in any unit is subject to a transfer fee. Minimum fees apply and are subject to increase for costs incurred by the franchisor, including but not limited to outside counsel fees, in connection with reviewing and effecting the transfer. |
| Relationship Agreement and MBOA Legal Fees | The franchisor estimates the legal fees for its negotiation of a relationship agreement to be between $20,000 and $100,000, but may be higher. |
| Reimbursement of Insurance Expense | Actual cost of insurance. |
| Mid-Term Upgrade | $168,000 |
| Successor Fees | Varies by unit type |
| Extension Fee | $250 per month for 1-3 -months, $500 per month for 4-6 months, plus $1,000 for each additional month for 7+ months. |
| De-identification Costs | Actual cost of de-identifying unit. |
| Attorneys’ Fees | Prevailing party in any litigation is entitled to reasonable attorneys’ fees and costs paid by the other party. Outside counsel fees may also be due in connection with review and approval of a transfer of interest. |
| Liquidated Damages | If the Franchise Agreement is terminated for certain specified reasons, franchisees must pay liquidated damages equal to the greater of 11% of unit’s gross sales for last 12 months of operation or $100,000. |
| Development Fee (Development Agreement) | If franchisees purchase existing units from the franchisor and enter into a Development Agreement, and fail to timely open required units, they must pay Taco Bell $45,000 and periodic payments of $4,231 until the actual opening date of each new unit or 10 years from the missed opening date, whichever first occurs. |
| System-One Merchandising Program for Taco Bell Units or Multi-One Merchandising Program for KT Units | $717 per quarter per restaurant. |
