Houston TX Hot Chicken
Houston TX Hot Chicken franchises offer fast-casual hot chicken sandwiches and sides in a hipster atmosphere; known for spicy fried chicken; part of the quick-service restaurant industry.
Houston TX Hot Chicken franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operation of an HHC® restaurant is between $670,950 and $1,760,000. This includes between $65,000 and $127,500 that must be paid to the franchisor or its affiliates [p.1].
What is the initial franchise fee?
The initial franchise fee is a non-refundable, lump-sum payment of $50,000 due at the time the franchise agreement is signed [p.11, p.81].
What are the ongoing royalty and advertising fees?
The ongoing royalty fee is 6% of your Gross Sales for each reporting period [p.81]. Additionally, you must pay a brand fund fee of 2% of your monthly gross sales, which supports national marketing and public relations efforts [p.35, p.84-86].
How long is the initial franchise agreement, and can I renew it?
The initial franchise agreement generally provides for a period of ten years [p.204]. However, this agreement may not be automatically renewed; whether renewal is possible depends on meeting specific conditions outlined in the agreement [p.153].
Can I sell or transfer my franchise, and what does that require?
The franchisor can refuse to permit a transfer of ownership of your franchise except for good cause. Good cause includes but is not limited to unspecified reasons. Additionally, there is a $5,000 transfer fee per undeveloped franchise plus the franchise fee for each active franchise agreement transferred [p.169].
On what grounds can the franchisor terminate the agreement?
This isn't specified in the excerpts. The provided FDD excerpts only detail termination grounds for the franchisee and mention restrictions on the franchisor's ability to cancel the franchise without reasonable cause under Virginia law, but do not specify the grounds for the franchisor to terminate 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 an exclusive territory [p.222, p.43]. However, the franchisor will not establish another traditional franchise or company-owned brick-and-mortar unit using the trademark within your territory [p.43]. This isn't specified in the excerpts regarding protected areas for multi-unit development agreements.
What training and ongoing support does the franchisor provide?
The franchisor provides initial training and materials for up to four people, including your controlling owner, operator of record, and general manager, at a fee of $5,000 [p.11]. They also offer periodic conference and convention courses, with attendance limited to no more than 2 national or regional meetings per year, each costing between $750 and $1,500 per person [p.42]. Additionally, the franchisor may provide additional training at their discretion, currently priced at $1,150 per day for key personnel [p.42]. Confidential information is disclosed during initial training programs, seminars, conventions, in the brand standards manual, and through guidance provided throughout the term of the franchise agreement [p.50].
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?
The franchisor does not make any representations about a franchisee's future financial performance or the past financial performance of company-owned or franchised outlets. However, if you are purchasing an existing outlet, they may provide actual records of that outlet. Additionally, if you receive other financial performance information or projections of your future income, you should report it to specified contacts as outlined in Item 19 [p.62].
What am I restricted to selling, and where must I buy supplies?
You are required to offer the products and services authorized by the franchisor and have the right to service customers both inside and outside your territory [p.44]. You may need to buy or lease items from the franchisor or a limited group of suppliers designated by them, which might be more expensive than other options [p.3].