KFC has grown well past its Bluegrass State roots into an international juggernaut with over 28,000 outlets in operation. While popular in the United States, about 85% of the chicken franchise’s locations are located outside the United States.
Kentucky Fried Chicken, more commonly known as KFC, is one of the world’s largest fast food chicken chains. The company was founded by Colonel Harland Sanders in 1952 and has grown to over 20,000 locations worldwide. KFC is known for its signature fried chicken recipes and fast food offerings. For entrepreneurs interested in getting into the food franchise industry, a KFC franchise can be a lucrative business opportunity. However, the costs involved in opening and operating a KFC franchise are substantial. In this article, we’ll take a look at the key costs involved and how much you can expect to invest to open your own Kentucky Fried Chicken franchise location.
Initial Franchise Fee
To open a new KFC franchise location, you must first pay an initial franchise fee to the company. This covers the rights to use the company’s branding, trademarks, recipes, and operating system. The initial franchise fee to open a new KFC restaurant is $45,000 This must be paid upfront before you can proceed with opening your franchise location. It allows you access to KFC’s proven business model to help get your new restaurant up and running.
Real Estate and Construction
Buying or renting the right land for your restaurant is one of the biggest costs you’ll have to pay up front when you open a KFC franchise. You will need a suitable building or land to build a new one that meets KFC brand standards. Real estate costs vary tremendously based on location. Most of the time, you can expect to spend between $400,000 and $1 $1 million just to buy or rent a building for your KFC franchise
The cost of construction is also high, ranging from $534,000 to $930,000. This includes the cost of building your restaurant or making changes to an existing building to meet KFC standards. It also includes costs for things like kitchen equipment, signs, decorations, furniture, point-of-sale systems, and more.
Equipment and Initial Inventory
You’ll need commercial equipment for food preparation, storage, safety, etc. Equipment costs range from $329,000 to $476,000 for a new KFC franchise location. This covers all the necessary equipment from fryers to refrigerators to food prep and cooking equipment. You’ll also need an initial inventory of food supplies, packaging, and ingredients to get started. This is estimated at around $10,000.
Training and Opening Costs
KFC requires franchisees to complete 6 weeks of hands-on training at an existing KFC location, as well as 2 days of classroom-style training. Training costs range from $7,000 to $10,000 per person. You’ll also incur costs related to your grand opening marketing launch, estimated at around $5,000.
Franchise Fees
In addition to the initial franchise fee, you’ll have to pay ongoing franchise fees. This includes a monthly royalty fee of 4-5% of gross sales. KFC also charges a national advertising fee of 4.5% of gross sales. There are other miscellaneous fees for things like audits, additional training, etc. that can add to your ongoing costs.
Additional Expenses
Some other costs involved with a new KFC franchise include:
- Permits and licenses ($50,000 to $100,000)
- Insurance costs ($7,250 to $10,050)
- Professional fees for things like legal and accounting
- Miscellaneous costs like uniforms, supplies, etc. ($5,000 to $10,000)
- Additional operating funds ($50,000 to $75,000)
Total Investment
Taking all these costs into account, the total investment to open a new KFC franchise restaurant ranges from $1.44 million to $2.77 million. This makes it one of the more expensive food franchises to open, but the potential returns can be significant with the built-in demand for the KFC brand.
The biggest costs come up front when you’re building, stocking, and getting your new restaurant ready to open. You’ll also need enough operating capital to pay for things like rent, food, royalties, marketing, repairs, and so on. It’s important to be able to get financing because the high total investment cost can keep some people from becoming franchisees.
Is a Kentucky Fried Chicken Franchise Profitable?
Given the high startup costs, a prospective KFC franchisee will want to understand the potential returns and profitability of owning a KFC franchise. The total investment of over $1 million may seem daunting, but the potential rewards of being part of a world-renowned brand like KFC can outweigh the costs.
When it comes to average unit volumes, KFC is always ranked as one of the best fast food chains, with $1 2 million to $2. 6 million per location. Because KFC is a well-known brand and sells a lot of food, opening a new franchise could give you a great return on your money. Kentucky Fried Chicken says that the average restaurant makes a cash-on-cash return of 15% or more.
Of course, profitability will depend on many factors like location, competition, local market demand, operations, and your ability to effectively manage your franchise. But the built-in demand for KFC’s signature fried chicken helps drive strong revenues. With good management, your KFC franchise investment can pay off handsomely.
Financing Your KFC Franchise
Very few franchisees can afford to self-finance the full $1.4 million to $2.7 million investment cost. That’s why financing is crucial when opening a new KFC franchise.
KFC does not offer direct financing, but they do maintain relationships with a network of lenders familiar with franchising. Many franchisees secure SBA loans, which are designed for small business owners and have favorable terms. With good credit and a sizable down payment (25-30% recommended), SBA loans can finance up to $5 million for eligible franchisees.
You may also consider equipment leasing, commercial mortgages, 401(k) business financing, home equity loans, credit cards, family loans, or partnerships to help fund your KFC franchise investment. Being well-capitalized and exploring all financing options is key to clearing the biggest hurdle – the high initial investment cost.
Is Opening a KFC Franchise Right for You?
Opening any franchise requires an immense commitment of time and money. Before diving in, carefully consider whether a KFC franchise aligns with your goals, skills, and financial situation. While rewarding, it requires solid business acumen and operational abilities to run a successful franchise location.
If you have prior multi-unit restaurant management experience, access to sufficient capital, a strong work ethic, and relentless drive to succeed, a Kentucky Fried Chicken franchise can be a very profitable business opportunity. The sunk costs are high, but the potential rewards of being part of KFC’s world-famous fried chicken brand may make it well worth the investment.
Kinds of KFC Franchise Types
KFC franchises fall under two categories: non-traditional and traditional. Non-traditional KFC outlets are smaller than traditional outlets and offer a limited menu. For the most part, Express outlets are located in “captive” areas, like military bases, transportation hubs, colleges and universities, business and industry sites, malls, places with a lot of foot traffic, amusement parks, sports stadiums, and other similar places. Traditional KFC outlets encompass all other KFC locations, offer a full menu, and are primarily freestanding.
Americas mid-market Alehouse sensation bringing handcrafted food, regional beers, Crazy Good Wings and Fingers, sales and profits!
Some Tastes are So Iconic, Theyre Legendary. Get in the business of simple yet delicious Greek food!
How Much is the KFC Franchise Fee?
The franchise fee for KFC is dependent on which type of franchise the franchisee decides to open. For non-traditional KFC locations, the franchise fee (which the franchisor calls the “initial license fee”) changes based on the length of the term. For non-traditional KFC outlets, KFC charges an initial license fee of $22,500. In a normal KFC franchise deal, the franchise (or initial license) fee is $45,000, which is split into a deposit fee and an option fee.
The franchise fee is basically a cover charge for entry into a franchise system, and for taking advantage of the expertise the franchisor has acquired. It typically covers the right to use the franchisor’s system (including trademarks and operating system), and services the franchisor provides to franchisees like help finding a location, training materials, etc.
How Much does a KFC Franchise Cost and Make?
FAQ
How much does a KFC franchise owner make?
The average income for a KFC franchise owner is between $130,000 and $177,240 per year. This depends on how old the franchise is and how much experience the owner has.
How much does it cost to open a Kentucky Fried Chicken?
The franchise fee to own a KFC is $45,000, and the estimated start-up costs are between $1 and $2 million. 2 million and $2. 5 million.
Is KFC a good investment?
KFC’s parent, Yum! Brands, has been a good investment over the years. As of mid-2025, it delivered a 10. 7% average annual total return over the past decade. Jun 5, 2025.
How much does a fried chicken franchise cost?
The estimated startup costs to become a KFC franchise owner range between $1. 2 million and $2. 5 million. This includes the franchise fee of $45,000 and a 5% royalty fee on gross monthly receipts paid to the company.
How much does it cost to buy a KFC franchise?
To buy a KFC Kentucky Fried Chicken franchise, you’ll need to have at least $360,000 in liquid capital. The total investment ranges from $1,000,000 to $2,000,000. They also offer a discount for veterans.
How many KFC Kentucky Fried Chicken stores are there?
There are more than 25,000 KFC Kentucky fried chicken restaurants in 145 countries and territories around the world as of the start of 2021. The vast majority of these are located in the United States, where the chain originated. In 1952, the first KFC restaurant opened. Over the next few years, the company quickly spread across the country.
Can you open a KFC franchise?
KFC franchise is a great way to enter a restaurant and fast food industry with a lot of help from the franchisor. Read extra information on the franchise and its cost below, and submit an application if you are interested. How to open a Kentucky Fried Chicken franchise? Ensure you have adequate capitalization.
Is KFC a good franchise?
In the U.S. alone, KFC has a strong footprint with thousands of outlets, making it a household name and a staple in the quick-service restaurant industry. KFC provides robust support to its franchisees, ensuring they have the tools and knowledge needed for success.
How much do KFC franchise owners make?
Although the exact salaries of KFC franchise owners are kept private by Yum! Brands, it is estimated that they take home around $120,000 per year. This is grounded on the average salaries of food franchise owners. Individual KFC units produce revenues between $942,000 and $1,000,000 per year.