KFC Franchise Cost & Fees

Date of Incorporation: 1939

Franchising Since: 1952

Headquarters: Louisville, Kentucky

Business Description: KFC outlets prepare and sell chicken, snackables and other approved menu items using the certain

trademarks and trade secrets owned by KFC Corporation. The franchisor is KFC Corporation (KFCLLC) whose parent is

YUM! Brands, Inc.

Franchise Offer: The licensee will operate a KFC outlet, which are characterized by a unique system which includes

special recipes and menu items, distinctive design, dcor and furnishings, specifications and procedures for operations

procedures for quality control; training and assistance; and advertising and promotional programs.

Financial Assistance: Parent company YUM offers two financing programs. Except as described below, KFLLCC does not

offer, directly or indirectly, any arrangements for financing the franchisees initial investment or the continuing operation of

the KFC business.

1. YUM Funding Financing Program: Funding is available to finance: (1) the construction of new (multi-brand or single -

brand) outlets; (2) the conversion of single-brand outlets into multi-brand outlets; (3) upgrades of outlets as required

under the applicable franchise agreement; and (4) the purchase of existing KFC, Pizza Hut or Taco Bell restaurants from

YUM. The maximum amount that may be borrowed by any one franchisee is $5,000,000. The minimum loan amount is

$200,000.

2. YUM Minority Lending Assistance Program: Optional lending assistance program for qualified minorities. The term

"minorities" is defined by the United States Small Business Administration for its business development programs at 15

U.S.C. Section 631(f)(1)(C) and it includes African Americans, Hispanic Americans, Native Americans, Indian tribes, Asian

Pacific Americans and other minorities. If the franchisee meets YUM's criteria for the Program and YUM agrees to allow the

franchisee to participate, then YUM's lending assistance will take the form of YUM guaranteeing 25% of the principal of the

franchised business loan up to a maximum of $3,000,000 per loan or franchisee.

3. Wells Fargo Equipment Financing Program: A financing program through Wells Fargo Equipment Finance, Inc. has

been arranged, pursuant to which Wells Fargo and participating banks (if any) will extend credit to certain KFC franchisees

for a limited time for purposes of remodeling existing KFC locations consistent with KFCLLCs specifications.

Training and Assistance: Franchisees (or a principal), their manager and the other employees of theirs indicated on the

tables below must attend and complete, to KFCLLC's satisfaction, the initial training program. If the KFC location being

purchased is a co-brand restaurant, the initial training program will include training on the combined operations and issues

specific to the operation of the related brands. Franchisees, their managers and other employees of theirs must also take

all online Learning Zone courses for all job roles in the restaurant. KFCLLC may offer additional training courses, seminars

and programs and charge franchisees for this additional training.

Territory: The franchisee will have a protected territory of the smaller of a radius of 1 miles of the KFC outlet, or an

area around the KFC outlet containing 30,000 people. The franchisees rights with respect to the protected territory will not

be dependent upon achievement of a certain sales volume, market penetration or other performance factors. Within the

protected territory, KFCLLC will not use or permit others to use in selling food products, any of the Marks that the

franchisee has the right to use under the franchise agreement, except for (a) special event sales and (b) in some cases,

food products (other than chicken in whole pieces) using the name or image of Colonel Sanders. The outlet may only be

relocated with KFCLLC's advanced written approval.

Term of Agreement and Renewal: The term of the franchisee agreement is 20 years. Renewal terms are dependent on

the franchise agreement signed.

Obligations and Restrictions: During the term of the franchise agreement the franchisee or a fully -trained and qualified

manager must devote full time to the management and operation of the KFC outlet. The franchisee is responsible for the

full performance of the franchise agreement and, if the franchisee is a corporation, one or more of the shareholders may

be required to individually guarantee the performance of the obligations under the franchise agreement. The franchisee

must sell all Required Products as KFCLLC periodically designates. The franchisee may not deliver any product from the

KFC outlet or anywhere else unless separately approved for delivery and have signed a Delivery Amendment. The

franchisee may cater (not including delivery), and make sales at special events only the franchisee complies with KFCLLC's

procedures.

Estimated Number of Units: 19,955

Investment Tables:

Initial Investment for Free Standing Outlet

Name of Fee Low High
Application &
Background Check Fee $300 $500
(per person)
Initial Franchise Fee $45,000 $45,000
Training Expenses $2,500 $9,500
Permits, Licenses,
$50,000 $100,000
and Security Deposits
Real Property $400,000 $1,100,000
Building & Site Costs $534,000 $745,000
Equipment, Signage,
and Dcor, POS & $280,000 $385,000
MERIT
Initial Investment for Free Standing Outlet
Name of Fee Low High
Start-up Inventory $10,000 $10,000
Grand Opening Expense $5,000 $5,000
Additional Funds $50,000 $75,000
Total Estimated
$1,453,800 $2,576,000
Expenditure
Other Fees
Type of Fee Amount
5% of gross revenues or a minimum of
$825, whichever is greater per month
Royalty
(minimum fee subject to adjustment
based upon the Consumer Price Index).
0.5% of gross revenues (or as agreed to
Local Advertising
with local advertising co-ops).
National Co-op 4.5% of gross revenues.
$6,750 (subject to adjustment based
upon the Consumer Price Index) if the
Renewal Letter Agreement is signed. If
franchisees signs certain Amendments,
they have no right of renewal.
For existing franchisees $3,375 for first
outlet and $1,688 for each additional
outlet in the same transaction.
Transfer
For new franchisees $6,750 for first
outlet and $3,375 for each additional
outlet in the same transaction.
Entire cost of audit, including expenses
Audit
of auditing personnel.
$500 services fee for each transaction in
which KFCLLC processes changes to
Administrative franchisees corporate structure or when
processing other approved
modifications.
Additional Services $0 - $2,000
Costs, expenses and
Will vary.
attorneys' fees
Initial Investment for Free Standing Outlet
Name of Fee
Indemnification
Late royalty payments
Food Standards
Consultations (FSC)
Support Services and
Software Maintenance
for KFCC's MERIT
System
One System Fund Fee
Low High
Will vary.
1 - 1.5% per month.
$287.50 per follow-up assessment.
$156.61 per unit/per month. For
franchisees not operating under the
New MERIT Agreement, the monthly
MERIT Fees will be $171.50
$1,065 per restaurant (one-time
enrollment fee); then $180 per
restaurant/per month (plus applicable
tax and shipping) (reoccurring
payments).

2. Starting a KFC franchise in India can be one of the best business ventures, as the US based Kentucky Fried Chicken has
gained enormous popularity in India over the last decade. Fast food franchises in India usually tend to perform well, and
KFC comes from Yum! Brands that have witnessed tremendous success with Pizza Hut and Taco Bell as well!

Here, you can learn more about the steps to open KFC franchise in India, cost and requirements, return on investments for
KFC franchise, contact information for Indian franchise units and more. Keep reading!

Why Kentucky Fried Chicken?

Why are you looking to open a KFC restaurant and not any other fast food franchise? Yes, you know it! Yum! is a brand you
can really rely on, and KFC needs no introduction to Indian consumers. The craze is multiplying every year, especially
among the younger generations; and in a high footfall area, your business can start a-rolling within a quick time!

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Investments for KFC Franchise in India: Cost is worthy of returns

Opening a KFC franchise is a huge investment, but the anticipated return is worth it. Yum! brand does not explicitly mention
the cost of starting a KFC franchise in India, but we can make gross assumptions as per the US standards. In the United
States, one requires to have liquid assets worth 3.6 million US dollars, which is nearly 2 crores in the Indian currency.
Nevertheless, India has cheaper lifestyle than the United States, and our experience is that Indian units of international
franchises usually cost half of their US counterparts. Going by these gross calculations, we can say that the estimated
investment for KFC franchise in India will be somewhat like 1 crore. Apart from that, in the United States, KFC franchise
costs include having a net worth of $1,000,000 and a $25,000 franchise fee. Also, there is a 4% royalty fee on actual sales,
which is internationally applicable. KFC is thus one of the high capital franchise business opportunities in India, but
nonetheless it is worthy of it. As per our assumption, the anticipated return period of capital can be 2 to 3 years.

Starting KFC Restaurants in India: How to open an unit franchise?

In order to start a KFC franchise in India, you will have to visit their official website and fill in the application form. There is no
other mode of writing to them or contacting them apart from the KFC franchise application form in the prescribed pro forma.
In the official KFC site, click Alliance with Us in footer, and select the option Franchise. Now you will have to provide your
name and contact number and give them a brief description about why you want to start KFC franchise and why do you
think you are good enough for running the show. Remember, your application is the only way to convince them!

Upon successful submission of KFC India franchise application form, you will receive an email from their Deputy Manager
(Business Development) of Yum! Restaurants India, Vishal Razdan. If they accept your business proposal, you are all cloud
nine! Even if they do not, you can wait for some time and resend your application; KFC franchise units in India are fast
expanding and they can re-consider your once rejected application after an year or so.

Yum! Restaurants (KFC) India Contact Details (For opening a franchise)

Vishal Razdan
Deputy Manager Business Development
Yum! Restaurants ( India ) Pvt. Ltd.
Global Business Park
Tower D, 12 Floor
Gurgaon 122002, India.

Email Contact: franchisee.india at yum.com

 3.Multi-Unit Operations Experience
Proven track record in operating a multi-unit restaurant or
hospitality business (preferably quick service restaurant)
Successful business ownership experience (preferably multi-
unit restaurant)
Financial Qualifications
$1,500,000 Total Net Worth
$750,000 Total Liquid Assets*
Net Worth and Liquid capital access commensurate with
ownership level (may vary significantly from minimum
requirements)
Personal & Financial
Reputation and Stability
Criminal convictions, history of litigation,
Bankruptcy history
Minimum Credit Score of 700
Business history and reputation, referrals
Press/Social Media
Motivation and Commitment
Willingness to guarantee Franchise
Agreement obligations
Time commitment for required training
programs (includes entire organization)
Hands on in the day to day operation of
the business, Residency/proximity
 4. COMMON QUESTIONS
- What are the minimum financial requirements?
Candidate must have $1.5 Million in total net worth and $750,000 in liquid assets (liquid assets are
defined as cash or any asset that can be converted to cash within 10 business days). Requirements are
commensurate with ownership level and may be significantly higher from minimum requirements based
on the size of the transaction.
- How long does the Franchise Assessment Process take?
Initial review of the Franchise Assessment Process, including background checks and interviews,
generally takes 8 - 12 weeks. If a franchisee candidate meets the initial review criteria and is found
eligible to proceed, a transaction review and approval will be required for all transfers or new
development opportunities.
- Are there Opportunities to acquire existing restaurants?
Yes, there are opportunities to acquire existing restaurants. If franchised restaurants are identified for
sale, all negotiations will occur between the buyer and seller. All transfers (acquisitions of existing
franchised stores) must be reviewed by KFC US LLC through the Transaction Approval process prior to
any approval of the transfer.

If buyer is new to the KFC US LLC system, they must successfully complete the KFC Franchise
Assessment Process to be considered eligible to progress to the Transaction Approval Process.
- Theres already a KFC in my market, can I add another one?
Existing KFC operators have a protected territory of 1.5 miles or 30,000 people, whichever is smaller.
Prior to allowing the establishment of any new franchised restaurant, KFC US LLC is obligated to give the
closest franchisee 30 days prior written notice of the proposed new location. During the 30 day period, the
franchisee may apply to KFCC for the right to build the restaurant and KFC US LLC shall negotiate in
good faith with the franchisee, taking into consideration all relevant factors, including past and present
operational performance and financial capabilities of the franchisee, etc.
- Is KFC seeking new minority candidates?
Yes, KFC US LLC is committed to increasing the number of minority and women owned franchises.
- How much will I pay in royalties and advertising? What fees will I pay
when I become a KFC franchisee?
Royalties = 5 percent (5%) of Gross Revenues
Advertising = 5 percent (5%) of Gross Revenues (Includes national and local contributions)
The above amounts do not include all fees that will be incurred by the franchisee. Please refer to Item 6
and Item 7 of the KFC US LLC Franchise Disclosure Document (FDD) for details pertaining to new
franchise application fees, transfer fees, training expenses, initial franchise fees, constructing a new
restaurant, grand opening expenses and opening inventory. In addition, the franchise will be required to
pay other fees, including but not limited to, monthly MERIT fees for the point of sale and back of house
computer system support.
- What will my sales be? How much money will I make? What will be my
profit percentage? What are the profit margins of other franchisees?
What kind of return on my investment may I expect?
KFC US LLC includes an Item 19 financial performance representation in the Franchise Disclosure
Document (FDD). You will receive an FDD once you have submitted a completed franchise application
package. Success involves risks and depends upon a franchisees ability as an independent
businessperson. KFC can give no assurance or warranty as to potential sales or results, and prospective
franchisees are encouraged to conduct their own independent investigation to determine potential sales
levels prior to signing any Franchise Agreement. Existing franchisees are a resource you can use for
more KFC franchise information. A list of domestic franchise units, the franchisee's name and phone
number are listed in the FDDs.
- What kind of training is required by KFC?
Before you may begin operating your restaurant, you (or a principal), your manager and other employees
identified on the tables in Item 11 of the Franchise Disclosure Document (FDD), must attend and
complete, to KFC US LLCs satisfaction, the initial training program offered by KFC US LLC on the
operation of a KFC outlet. The training includes 1 week orientation, 2 weeks online training and 4 weeks
in a certified restaurant for hands on training. All training costs incurred including travel and lodging of the
management team are the responsibility of the franchisee. More details found in the KFC US LLC FDD
Item 11.
- Will I be required to use specific accounting service software at my
restaurant?
KFC US LLCs Franchise Disclosure Document (FDD) describes the type of electronic cash register
system and software requirements to be used in the restaurant. It is required that you use the KFC US
LLC supported MERIT point of sale and back-of-house operating platform. You must prepare and keep
detailed records regarding all sales and other financial aspects of your restaurant operations. You may
also be required to submit reports of product mix, hourly and day-part sales and other reports as may be
determined by KFC US LLC.
- Is KFC listed in the Small Business Administration (SBA) Registry?
Yes, the franchise registry (www.franchiseregistry.com) is a national online listing of approved franchise
systems whose franchisees will receive accelerated loan processing through the U.S. Small Business
Administration (SBA). Through this process, small business owners are provided with higher levels of
service and quicker loans. Franchise systems not listed on the site are not eligible for expedited loan
processing through the SBA.
- I am interested in KFC Franchising in another country. What is the
process to become an International Franchisee?
Please visit the YUM International Website at www.yrigfp.com to obtain information regarding active
countries and the International franchise approval process.
In another country application form will be provided in this page:
http://www.yrigfp.com/getting_started.asp

YUM! Restaurants International will help you work through the process.

Here's a closer look at our new franchisee approval process. First, you need to make sure that YRI is actively seeking candidates for new
franchisees in your country of choice. Then, you will need to fill out our "Franchise Information Request Form". If you are selected, the
Regional Franchise Recruitment Manager (RFRM) will contact you and send you a more detailed Franchisee Application. Once the RFRM
receives your completed Franchisee Application, the Local Franchise Recruitment Manager will contact you regarding the additional
requirements of the approval process.

Our 3 Step Program

1. Contact and Application:

Start by filling out our Franchise Information Request Form:

Franchise Information Request Application
If selected, a Regional Franchise Recruitment Manager (RFRM) will contact you
You will then be asked to complete and return a comprehensive Franchisee Application

2. Evaluation:

At this point, if you are selected, you will be asked to:

Meet with the RFRM to review the comprehensive application
Undergo a background investigation
Meet with appropriate YRI management team members

3. Approval:

Begin the market development zone and site selection process

If you are approved as a new franchisee, you will then need to undergo restaurant training

Please understand that this process will likely include additional steps and requirements, and may vary from region to region in accordance
with local laws and processes. This is not an advertisement to sell a franchise. An offer can only be made through a Uniform Franchise
Offering Circular or other specific written offer by Yum! Restaurants International

Is becoming a KFC Franchise a profitable business deal?

While this question may be a pertinent one for people planning to open a KFC Franchise, for others who knows the
brand well this may appear to be a mockery. KFC Franchise is a much sought for offer and many aspire for a
profitable business association with KFC.

KFC is such an established brand which has already proven its high standards to people across the world. This being
the fact, the prospective candidate who wants to take a Franchise gets rid of advertising and marketing efforts and
cost right from the first day of business. The prospective candidates also get rid of efforts to attract customers since
the quality of KFC is an established one.

The brand is so established that it cost aspect never become the point of argument with the customers at any point of
time. Through it stringent assessment standards in selecting the Franchise KFC ensures that all Franchise starts
earning profit in a minimum break even period.

Requirement to become a KFC Franchise

KFC has set very high standards for people aspiring for a business association in the name of Franchise. The well
laid out standards assesses the potential candidates who seek to open a Franchise through questionnaires that fall
under six categories. These six categories assess the financial qualifications and personal financial reputation of the
candidate. It also assesses the candidates multi unit operational experience and growth mindset along with his
motivation and commitment levels. Culture and Brand fit are the other two aspect on which the prospective candidate
is assessed on.

By assessing the prospective candidates on various areas like business ownership experiences, criminal convictions
records, willingness to agree to the obligations written out and other key areas KFC offers distributorship only to
strong candidates. The detailed questionnaire every candidate is provided with for filling up draws out clarity in their
minds regarding the various aspects of the business deal.

Investment requirements to start a KFC Franchise in India

While the investment details to start a KFC Franchise in India needs to be ascertained from KFC directly, an
indicative cost of the same seems to be minimum 1 crore approximately. While the return on investment can be
expected between the 2nd and 3rd year, the agreement period signed by KFC is usually 20 years.
The renewal of contract between KFC and the Franchisee depends on various factors thought the major one is the
business success exhibited by the Franchise. KFCs market presence in a typical Indian scenario speaks volumes
about its success.

If you have the money power and aspiration to get associated with this multi national brand food chain, go in for this
prestigious association without any further delay.
Fill in the application in KFC website providing all pertinent details being asked for. If your application is accepted
after assessing all your details, a mail will be sent to you and you can take it forward as per the instructions provided
thereafter. If your application for starting a Franchise gets rejected the first time dont get dejected. Apply the second
time and you may get lucky since KFC is rapidly expanding.
KFC India Contact Details (For opening a franchise)
Vishal Razdan
Deputy Manager Business Development
Yum! Restaurants ( India ) Pvt. Ltd.
Global Business Park
Tower D, 12 Floor
Gurgaon 122002, India.