Opening a Taco Bell restaurant requires a lot of cash.
Startup costs, which include construction expenses and a $US45,000 franchise fee, average between $US1.2 million and $US2.5 million, according to the company.
The costs are slightly lower — between $US175,000 and $US1.4 million — for franchisees to acquire an existing Taco Bell restaurant.
Because initial costs are so high, Taco Bell requires potential franchisees to have a minimum net worth of $US1.5 million and at least $US750,000 in liquid assets.
Once the restaurant is up and running, the company charges an ongoing royalty fee equal to 5.5% of gross sales.
If successful, the restaurant will bring in annual sales of at least $US1.4 million, which is what the average Taco Bell restaurant generated last year, according to QSR magazine.
Taco Bell’s franchisee startup costs are similar to those of KFC, Wendy’s, and McDonald’s.
Subway, by comparison, is far less expensive, costing between $US116,000 and $US262,850, according to the company. Subway also requires minimum liquid assets of only $US30,000 to $US90,000.
But the average Subway restaurant generates only $US490,000 in sales per year.
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