Golden Chick
Golden Chick operates quick-service chicken restaurants offering familiar fast-food fare. Known for its straightforward franchise model, it requires significant investment but provides clear fee structures and development options in the restaurant industry.
About Golden Chick
Golden Chick, formerly known as Golden Fried Chicken, is a quick-service restaurant franchise headquartered in Richardson, Texas. Mark Parmerlee, head of Golden Tree Restaurants serves as the President and Chairman.
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Golden Chick franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to develop a single, prototypical Golden Chick Restaurant ranges from $993,750 to $1,852,800 for a free-standing ground-up construction, $865,250 to $1,455,000 for a free-standing conversion, and $810,250 to $1,393,900 for an end-cap construction (excluding any cost of real estate and any delivery and/or catering vehicles). [p.1]
What is the initial franchise fee?
The initial franchise fee is $30,000 for the first Golden Chick Restaurant. For subsequent restaurants developed under a Development Agreement, the fee is 60% of the then-current initial franchise fee ([p.13, p.24]). If you are a VetFran Participant, your initial franchise fee for the first restaurant is reduced by 33.33% of the current initial franchise fee ([p.23, p.13]).
What are the ongoing royalty and advertising fees?
The ongoing royalty fee is 2% of weekly Franchisee Gross Revenues [p.17]. Additionally, you must contribute up to 2% of your weekly Franchisee Gross Revenues to the National Ad Fund at the same time as the Weekly Royalty Fee [p.17]. This contribution is in addition to any administrative fees or management fees that may apply if services are retained from an affiliate [p.17, p.18].
How long is the initial franchise agreement, and can I renew it?
The term of the franchise agreement includes any options to renew the lease, which must be exercisable solely by the franchisee. However, this term does not explicitly state the length of the initial franchise agreement or provide details on how renewals are handled beyond mentioning lease terms [p.111].
Can I sell or transfer my franchise, and what does that require?
This isn't specified in the excerpts.
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the agreement under several grounds as outlined in [p.195], including reducing the number of restaurants required to be opened, modifying the size of the development area, terminating territorial exclusivity, withholding approval for site proposals, accelerating the development schedule, or pursuing other remedies available under the agreement.
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts.
Do I get an exclusive or protected territory?
No, you do not receive exclusive or protected territorial rights. According to [p.144], there are no 'exclusive,' 'protected,' or other territorial rights granted or inferred under the agreement.
What training and ongoing support does the franchisor provide?
The franchisor provides initial and ongoing training programs, including 'refresher' on-the-job training at reasonable intervals, to ensure compliance with Franchisor Standards. This training is conducted either at a company-owned restaurant, the franchisee's location, or another specified site [p.35]. Ongoing support includes access to Copyrighted Materials for training and the use of the Qu POS system, which requires executing a Technology Services Agreement [p.33]. Additionally, the franchisor can offer special or remedial training at their sole discretion [p.35].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts.
Does the franchisor share any financial performance or earnings information?
Yes, the franchisor shares financial performance information. According to [p.48], the franchisor can provide actual or potential financial performance data for its franchised and/or company-operated locations if there is a reasonable basis for this information. However, [p.57] also states that other than the information provided in Item 19, no financial performance representations are made, and employees or representatives are not authorized to make such representations either orally or in writing.
What am I restricted to selling, and where must I buy supplies?
You are restricted to selling only menu items specified by the franchisor, in quantities and sizes specified by them, and following their specifications and formulas. You must also sell no other food or drink item or merchandise without prior written approval [p.41]. For supplies, you must purchase or lease items from the franchisor or a limited group of suppliers designated by them, which may be more expensive than similar items available on your own [p.3]. Additionally, all furniture, fixtures, equipment, ingredients, and other similar items used in your Golden Chick Restaurant must also be purchased only from approved suppliers [p.25].