Burger King
Burger King offers quick-service restaurants specializing in hamburgers and other fast-food items. Known for its iconic slogan "Have It Your Way," Burger King operates in the global fast-food industry.
About Burger King
Burger King Corporation is an American fast food chain of hamburger fast food restaurants, headquartered in Miami-Dade County, Florida. The company was founded on July 23, 1953, as Insta-Burger King, a Jacksonville, Florida–based restaurant chain. After Insta-Burger King ran into financial difficulties, its two Miami-based franchisees David Edgerton (1927–2018) and James McLamore (1926–1996) purchased the company in 1959. Over the next half-century, the company changed hands four times and its third set of owners, a partnership between TPG Capital, Bain Capital, and Goldman Sachs Capital Partners, took it public in 2002. In late 2010, 3G Capital of Brazil acquired a majority stake in the company in a deal valued at US$3.26 billion. The new owners promptly initiated a restructuring of the company to reverse its fortunes. 3G, along with its partner Berkshire Hathaway, eventually merged the company with the Canadian-based coffeehouse chain Tim Hortons under the auspices of a new Canadian-based parent company named Restaurant Brands International.
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Burger King franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operation of a BURGER KING® Restaurant ranges from $363,400 to $4,730,500, excluding real estate. This range includes costs such as the nonrefundable deposit and prepaid franchise fee [p.1, p.510].
What is the initial franchise fee?
The initial franchise fee varies based on the FSS Development Grade. For an 'A' or 'B' grade, it is $25,000, while for a 'D' or 'F' grade, it is the Base Fee, which is the greater of $50,000 or the current standard initial franchise fee required for new franchisees [p.31, p.508]. This fee is fully earned when the Franchise Agreement is signed and is not refundable [p.28, p.51].
What are the ongoing royalty and advertising fees?
This isn't specified in the excerpts. The provided FDD excerpts discuss what happens upon default or transfer of a franchise interest, but do not detail the specific amounts or terms of ongoing royalty and advertising fees.
How long is the initial franchise agreement, and can I renew it?
The term of the Agreement commences on a specified date and shall expire on another specified date unless sooner terminated [p.484]. The franchise grant contains no promise or assurance of renewal, and the sole conditions for obtaining a Successor BURGER KING Franchise Agreement at expiration are those set forth in Section 17 of the Agreement [p.359; p.484; p.237].
Can I sell or transfer my franchise, and what does that require?
Yes, you can sell or transfer your franchise, but it requires certain conditions. According to [p.960], if you wish to transfer your interest in a Participating Restaurant, the transferee must agree to participate in the Ad Fund FTF Program and sign a Co-Investment Agreement for each restaurant being acquired. Additionally, the franchisor (BKC) may withhold consent if the proposed transferee does not meet these requirements. [p.960]
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the agreement if a Termination Event occurs, as specified in [p.915]. Additionally, the franchisor may terminate the agreement if the franchisee continues to operate the Franchised Restaurant after the end of the term without obtaining a Successor Franchise Agreement, operating on a month-to-month basis under the terms and conditions of the original agreement ([p.188]). This isn't specified in the excerpts for other explicit grounds of termination.
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts. The FDD provides information on start-up phase funding but does not detail specific net worth or liquid capital requirements for qualification as a franchisee.
Do I get an exclusive or protected territory?
No, you do not receive an exclusive territory. The FDD states that you may face competition from other franchisees, from outlets owned by the company, or from other channels of distribution or competitive brands [p.72, p.71].
What training and ongoing support does the franchisor provide?
The franchisor provides ongoing support as deemed reasonably necessary by BKC to assist franchisees with operating their Burger King restaurants. This includes communication and advice on the Burger King System [p.194, p.244]. Additionally, the training team, led by John Zurovchak, offers training programs, courses, and support materials, with team members averaging over 3 years of experience in quick-serve restaurant or hospitality operations training [p.66].
How many franchised outlets are there, and how many have closed or been terminated?
As of December 31, 2024, there were 6,229 traditional franchise outlets in the BURGER KING system [p.97]. Additionally, 874 non-traditional franchise outlets existed for the same period [p.97]. The excerpts do not specify the exact number of closed or terminated franchises but indicate that some restaurants temporarily or permanently closed during 2024 and were excluded from the sales distribution chart [p.97], [p.99].
Does the franchisor share any financial performance or earnings information?
The franchisor can provide actual records of an existing outlet you are considering buying [p.95]. Additionally, they may supplement the information provided in Item 19 with possible performance at a particular location or under specific circumstances [p.95]. However, the franchisor does not make any representations about future financial performance and does not authorize its employees to do so either orally or in writing [p.108].
What am I restricted to selling, and where must I buy supplies?
You are restricted to selling products and menu items at prices you determine except for Value Menu items, which have a maximum price set by the franchisor. You must comply with any changes in menu items, ingredients, or standards that the franchisor implements [p.80]. For supplies, you may be required to buy or lease certain items from the franchisor or designated suppliers, which could be more expensive than purchasing them independently [p.3].