McDonald's
Burgers, chicken, salads, beverages- 2022 Franchise 500 Rank
-
#14 Ranked #11 last year
- Initial investment
-
$1.4M - $2.5M
- Units as of 2022
-
39,696 4.2% over 3 years
Here’s what you need to know if you’re interested in opening a McDonald's franchise.
McDonald's has become a staple in fast meals on-the-go. Whether it's a Happy Meal or a McChicken, the world is lovin’ it.
If you're interested in running a location of your own, McDonald's actually operates through purchasing and branding existing restaurants. Regarded as one of the most lucrative businesses in fast-food, franchisees can trade using the brand name to leverage on their existing customer base.
Under this model, McDonald's may lease any of their locations to you based on their stipulated terms and operating procedures. Outlet owners operating under the brand must operate under their policies. McDonald’s executives make a profit by acquiring existing outlet locations, branding, and then leasing to potential franchisees.
Setting up one of these McDonald's franchise locations may be a successful venture, especially when compared to establishing a new restaurant under a different name. The company focuses on preserving its brand and defending its reputation. Because of this, opening a McDonald's franchise may offer a perfect opportunity to make your mark on the restaurant industry.
Why You May Want to Start a McDonald's Franchise
If you plan to run a restaurant under those golden arches, you'll have to follow the specific procedures for running any McDonald's restaurant locations. The good news about trading under the brand is that you may have a higher likelihood of succeeding than if you did not.
It's no secret that McDonald's commands a considerable following, especially in the American fast-food industry. The fast-food chain enjoys global recognition for its affordable and growing menu.
Setting up a McDonald’s franchise requires entering into an agreement to run a restaurant under McDonald's brand. It'll allow you to operate under the brand for a specific length of time, depending on the agreement. Many agreements last for 20 years.
The unique aspect of running a business under McDonald's is that it may be easy to draw in loyal (and hungry) customers. This is all thanks to the credibility and status that comes with the McDonald's brand… and, of course, their irresistible french fries.
Why Opening a McDonald’s Location May Be a Good Choice
At the end of the day, owning a McDonald's outlet could result in a pretty successful enterprise. Coupled with a good reputation and a considerable market segment, opening a McDonald's franchise may have a more predictable outcome than investing in a completely new brand that may struggle to thrive in an already crowded and competitive fast-food industry.
As a result, riding on the already existing niche that McDonald's commands could give you an upper hand in kickstarting your business and enjoying the advantages. This doesn’t even take into account the fact that you may not have to spend a lot of resources on advertising to tap into local sales.
How to Establish a McDonald’s Restaurant Business
To open a McDonald’s franchise, you should ensure that you are financially sound enough for an initial investment made up of a franchise fee and other startup costs. You should also prepare yourself for ongoing fees that will include advertising, royalty, and renewal fees.
In some cases, McDonald’s requires a down payment before you can establish a restaurant in a new location. You may be required to pay a slightly less hefty down payment for acquiring an existing restaurant.
Before opening a McDonald’s franchise, the company takes franchisees through an extensive training program. Some of the support shared before signing a lease agreement includes information about suppliers, marketing, advertising, and improving hospitality oriented skills through free training. After this, you may be allowed to buy any of their outlets and operate under their policies.
Company Overview
About McDonald's
Franchising Overview
- Franchising Since
- 1955 (67 years)
- # of employees at HQ
- 885
- Where seeking
-
This company is seeking new franchisees throughout the US.
This company is seeking new franchisees worldwide.
- # of Units
- 39,696 (as of 2022)
Franchisor Information
Information for Franchisees
Here’s what you need to know if you’re interested in opening a McDonald's franchise.
Financial Requirements & Ongoing Fees
Here’s what you can expect to spend to start the business and what ongoing fees the franchisor charges throughout the life of the business.
- Initial Franchise Fee
- $45,000
- Initial Investment
- $1,366,000 - $2,450,000
- Cash Requirement
- $100,000
- Royalty Fee
- 4%
- Ad Royalty Fee
- 4%+
- Term of Agreement
- 20 years
- Is franchise term renewable?
- Yes
Training & Support Offered
Franchisors offer initial training programs and a variety of ongoing support options to help franchisees run their businesses.
- On-The-Job Training
- 100+ hours
- Classroom Training
- 81 hours
- Additional Training
- At local McDonald's restaurant
- Ongoing Support
-
Purchasing Co-opsNewsletterMeetings & ConventionsToll-Free LineGrand OpeningOnline SupportSecurity & Safety ProceduresLease NegotiationField OperationsSite SelectionProprietary SoftwareFranchisee Intranet Platform
- Marketing Support
-
Co-op AdvertisingAd TemplatesNational MediaRegional AdvertisingMarketing Planning & SupportSocial MediaSEOWebsite DevelopmentEmail MarketingLoyalty Program/App
Operations
Additional details about running this franchise.
- Is absentee ownership allowed?
- No
- Can this franchise be run from home/mobile unit?
- No
- Can this franchise be run part time?
- No
- Are exclusive territories available?
- No
Franchise 500 Ranking History
Compare where McDonald's landed on this year’s Franchise 500 Ranking versus previous years.
Additional Rankings
Curious to know where McDonald's ranked on other franchise lists? Find out below.
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