Habit Burger
Habit Burger franchises offer premium hamburgers, sandwiches, and salads in restaurants named 'The Habit Burger Grill.' Known for high-quality ingredients, this brand operates in the quick-service restaurant sector.
About Habit Burger
The Habit Restaurants, LLC, doing business as Habit Burger & Grill, is a fast casual restaurant chain based in Irvine, California, specializing in chargrilled hamburgers. The company sells typical fast-casual fare.
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Habit Burger franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operation under an Area Development Agreement and a Habit Burger Restaurant franchise ranges from $1,026,000 to $2,859,000 for build-to-suit end cap and standalone locations. This includes between $98,500 to $119,400 that must be paid to the franchisor or affiliate. [p.1, p.1]
What is the initial franchise fee?
The initial franchise fee currently stands at $35,000 and must be paid upon signing the Franchise Agreement [p.13]. This fee is fully earned when paid and is not refundable under any circumstances except in specific termination scenarios [p.13].
What are the ongoing royalty and advertising fees?
The ongoing royalty fee is typically 5.5% of the restaurant's gross sales and is paid monthly [p.85]. For advertising, franchisees must contribute a percentage of their restaurant's gross sales to an advertising fund, which the company uses for marketing programs [p.180].
How long is the initial franchise agreement, and can I renew it?
The initial franchise agreement typically has a ten-year term with the option to renew for one additional ten-year term [p.178]. However, the franchisor may choose not to renew your franchise without fairly compensating you under certain conditions [p.5(d)].
Can I sell or transfer my franchise, and what does that require?
You cannot sell or transfer your franchise without the franchisor's approval, except for good cause [p.5]. If a transfer occurs, the transferee must sign a new franchise agreement with terms that may differ from this one [p.108]. This isn't specified in the excerpts.
On what grounds can the franchisor terminate the agreement?
This isn't specified in the excerpts.
What financial requirements — net worth and liquid capital — do I need to qualify?
The franchisor reserves the right to require certain financial health metrics, including a minimum working capital reserve and other reasonable financial health measures at their sole discretion [p.100]. There is no specific mention of minimum net worth or liquid capital requirements for qualification in the provided excerpts. This isn't specified in the excerpts.
Do I get an exclusive or protected territory?
No, you will not receive an exclusive territory [p.82, p.42, p.250]. You may face competition from other franchisees, outlets owned by the company, and other channels of distribution or competitive brands that the company controls [p.43].
What training and ongoing support does the franchisor provide?
The franchisor provides initial brand standard training, which typically lasts between 10 to 20 weeks, covering managing and operating a Habit Burger Restaurant as well as issues related to brand standards. This training is mandatory for at least six managers, including the prospective franchisee, their Managing Owner, District Manager, and other designated personnel. The franchisor also offers ongoing support through the use of Operations Manuals and various instructional materials such as videos, web-based training, and handouts. [p.39, p.4]
How many franchised outlets are there, and how many have closed or been terminated?
According to Exhibit E on page [p.67], as of December 31, 2024, the document lists the current franchisees and area developers along with their restaurant addresses and contact information. It also includes any franchisees who had outlets terminated, cancelled, or not renewed by that date. However, specific numbers are not provided in these excerpts.
Does the franchisor share any financial performance or earnings information?
Yes, the franchisor may share financial performance information. According to [p.56], if there is a reasonable basis for the information, it can be included in the Disclosure Document. However, as stated on [p.62], such representations do not reflect all costs and expenses, and prospective franchisees should conduct an independent investigation. Written substantiation for these financial performance representations will be provided upon request.
What am I restricted to selling, and where must I buy supplies?
You are not specifically restricted to selling any particular items. However, regarding the purchase of supplies, you must buy Trade Secret Food Products during the franchise term only from Habit Burger Restaurants, their affiliates, or other specified exclusive sources at the prices they decide to charge [p.24]. For other goods and services, while there may be minimum standards and specifications, you can generally obtain items from any supplier who meets these requirements [p.25].