KFC was recently named one of the top restaurant franchises in the world.
The fried chicken chain ranked fourth among the restaurants in Entrepreneur’s list of top global franchises.
But opening a KFC restaurant requires a lot of money at the start.
The company requires operators to have at least $US1.5 million in total net worth and $US750,000 in liquid assets.
KFC also charges its operators a $US45,000 franchise fee, according to Franchise Direct.
Building and equipment costs — which include items like grills and fryers — range between 695,000 and $US1.2 million, Franchise Direct reports.
Other fees, such as training expenses and property costs, bring total startup expenses to between $US1.3 million and $US2.5 million.
Franchisees also have to pay fees every month for royalties and advertising. Together, the fees equal 10% of gross sales, according to the company.
That’s similar to what it costs to open a McDonald’s restaurant. But McDonald’s restaurants generate more than twice the amount of sales per unit compared to KFC restaurants.
McDonald’s restaurants on average generate $US2.5 million in sales annually, making McDonald’s the second-highest-grossing chain in the US by sales per unit behind Chick-fil-A, according to QSR magazine.
By comparison, KFC restaurants on average generate roughly $US942,000 in sales annually, QSR reports.
The company doesn’t reveal any details about its franchisees’ average profits.
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