If you’re looking to venture into the world of fast-food franchising, then a chicken franchise is a highly promising option.
Whether you’re an experienced entrepreneur in search of your next venture or a newcomer to the franchising game, this type of franchise is perfect for those with a strong entrepreneurial spirit.
As the popularity of chicken franchises has grown, new brands have emerged in the market. Traditional businesses have also expanded their menus to meet the increasing demand for chicken.
Owning a chicken restaurant business not only puts you ahead of the competition but also improves your chances of success, given the sector’s reputation as a highly profitable and sought-after industry.
This post will serve as your guide to launching your own franchise. Join us as we explore the world of chicken franchises and highlight the top-performing venture that reigns supreme in the industry.
Why Chicken Franchise?
With a chicken restaurant market size that exceeds $55 billion and an impressive annualized growth rate of nearly 10% for the past five years, investing in this industry could be incredibly beneficial.
Franchises can provide invaluable support and get your business up and running in no time. They offer training, brand recognition, and site selection advice that can help you attract consumers quickly.
Moreover, with access to proven systems, you can gain insight into:
- marketing strategies,
- technology solutions
- menu design,
- and inventories.
Additionally, as a franchisee of a big-name business, your supply chain will stabilize due to their pre-established relationships with key suppliers.
If you have worked in the chicken restaurant industry before, owning a franchise could be an ideal venture for you. All franchises must meet specific criteria, but fortunately, much business experience is necessary for many of them.
This creates an opportunity for individuals who were once employees to make the transition into becoming successful entrepreneurs!
Who makes more McDonald’s or Chick-fil-A?
Between the chicken-based chain Chick-fil-A and the 100% pure beef McDonald’s, who makes more money? Both are leading fast-food chains that have secured their prominent status in the industry.
We can compare the profitability of Chick-fil-A and McDonald’s by analyzing their EBITDA margins. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization.)
Here’s the formula for calculating EBITDA:
EBITDA = Revenue – Cost of Goods Sold – Operating Expenses
McDonald’s:
- Annual profits per franchised restaurant: $186,000
- EBITDA margin: 5.3%
Chick-fil-A:
- Annual profits per franchised restaurant: $1,277,000
- EBITDA margin: 15%
The 15% EBITDA margin for Chick-fil-A indicates its ability to convert a larger proportion of its revenue into profits before factoring in interest, taxes, depreciation, and amortization, compared to McDonald’s with a 5.3% margin.
Therefore, based on the provided information, Chick-fil-A emerges as more profitable than McDonald’s, specifically in terms of EBITDA margins.
Nonetheless, it is crucial to acknowledge that profitability is influenced by diverse factors, encompassing operating costs, market conditions, and regional disparities.
However, McDonald’s has a larger number of units and a global presence, which makes it more profitable overall. Chick-fil-A, on the other hand, operates solely in Canada, the United States, and Puerto Rico, limiting its international footprint.
Despite having fewer franchise units, this chicken-based restaurant’s success in the industry cannot be ignored. With its distinct strategy of offering delicious and reasonably priced meals, Chick-fil-A has carved out a niche for itself in the competitive fast-food market.
5 Most Profitable Chicken Franchise Ideas
To determine whether a franchise business idea is worth pursuing, gaining insights into the market, understanding the competition, and identifying customer needs is important. The viability of the idea depends on these factors.
Below, you will find a thoughtfully curated list of chicken business ideas that will assist you in identifying the one that dominates the industry.
1. Fried Chicken Restaurant
This irresistible crispy flour-coated delicacy has won over countless customers nationwide, making it the go-to choice for any time of day or night. With its satisfying new flavors, the industry is expected to gain more success.
Fried chicken franchise models are taking the market by storm, boasting impressive profits and standing out as highly successful businesses with lucrative franchise opportunities. CAGR predicts a remarkable annual growth rate for the Fried Chicken Franchises market between 2024 and 2031.
Gross sales of chicken franchises can vary widely, from $50,000 to over $3 million per year. The profit margins typically range between 7% and 8%, but this can fluctuate depending on the menu options and the franchise’s location.
When embarking on a franchise in this business model, it’s crucial to note that each business has its own unique concepts. This sets it apart from the competition, making it a compelling opportunity to pursue.
The following concepts are excellent choices to begin with.
Fried Chicken Rice Bowls concept:
Opportunity to create innovative dishes that combine Eastern and Western flavors.
In addition to the rice and crispy fried chicken that’s advertised in the very name of the dish, other things diners can expect to find in the bowl include shiitake mushrooms, sweet potatoes, and green shishito peppers, topped with a sweet and spicy sauce.
Hot Sauce-Marinated chicken
The Tabasco sauce and cayenne pepper blend-marinated meat is inspired by the small red sticks the hot sauce company uses to see if the pepper is properly ripe.
The chicken tenderloins are breaded too and are best enjoyed with the new Smok’n Pepper Ranch. They also come with Cajun Fries and a buttermilk biscuit.
2. Chicken Wing Franchise
The love for mouth-watering wings has become a part of American culture and shows no signs of slowing down. As a result, many more restaurant chains and franchises have chosen to specialize in serving this popular menu.
In the US, the chicken wing industry has a market size of $55.6 billion and is growing at an annual rate of 8.4% between 2018 and 2023. As of January 9, 2024, there were 13,708 chicken wing restaurants in the United States.
Take-out chicken and wings businesses enjoy a gross margin of around 40%, making it easier to manage costs and expand the business.
Owning a chicken wings franchise can be a major milestone in one’s life. To make this move, one needs to carefully evaluate every aspect of the brand, starting with the industry it operates in.
It is imperative to have a concept that customers crave and to work with cutting-edge technology to keep the business at the forefront of the field.
Sports bar concept:
A chicken wing franchise that offers a memorable dining experience in a sports bar concept. Sports Bar is a social hub where visitors gather to celebrate victories, commiserate defeats, and create lasting memories.
With exceptional service, a dynamic atmosphere, and delicious buffalo wings. A franchise is the go-to destination for sports enthusiasts seeking exceptional flavors.
Chicken wings and chips concept:
Another culinary haven where the marriage of succulent chicken wings and perfectly crispy chips creates a symphony of flavors that will tantalize your taste buds. This business concept is founded on the belief that simple, high-quality ingredients, prepared with care, can result in a dining experience that is both satisfying and memorable.
3. Grilled Chicken
This juicy and smoky-flavored recipe features a delightful blend of hung curd and spices like cumin powder and black pepper. It’s an ideal recipe for a quick meal that’ll leave everyone’s taste buds satisfied.
Over the past five years, the demand for grilled food has skyrocketed, leading to a significant increase in the grill industry. Menu items like pulled pork, brisket, and ribs have become a trend in restaurants, and as a result, the revenue from grilled food options has grown at an annualized rate of 2.0% to $4.0 billion.
The global Barbeque (BBQ) Grill market has been valued at USD 4808.6 million in 2022 and is expected to reach USD 6106.6 million by 2029, showing a CAGR of 3.4% during the forecast period of 2023-2029.
Here is a graph depicting the value of the barbecue grill market in the United States from 2015 to 2025.
When venturing into a franchise with a business model, it offers distinctive concepts to stand out from other opportunities, such as the following:
Freshly-made concept
A haven for health-conscious consumers seeking a delightful blend of flavor and nutrition. This restaurant concept provides a fresh and wholesome dining experience centered around freshly made fire grilled chicken.
Tailored to cater to a demographic that prioritizes balanced meals and favors whole foods over processed alternatives, our establishment embraces a “cook-from-scratch” philosophy.
Marinated and grilled chicken
This marinated fresh chicken, grilled and paired with an array of flavorful sides like a variety of sides like mashed potatoes, and green beans, promises a dining adventure where the bold and the savory collide.
To complement the star attraction, this culinary journey extends to various side dishes such as rice, beans, and vegetables, all infused with similarly spicy profiles.
4. Fast Food Chicken Tenders
This Fresh hand-breaded also known as chicken fingers has always been a staple of many menus nationwide and has slowly become dominant in the industry.
Chicken tender franchises offer a reliable source of profit, with a serving yielding an average of 65 percent profit due to a massive 185 percent markup. Also, the market for fried chicken tenders remains stable and adaptable to industry changes.
The chicken tender franchise is a booming industry valued at over $230 billion. With a firm grip on the food service industry, chicken tenders show no signs of losing their popularity anytime soon.
Consider looking into the following unique concepts of chicken tender franchises to kickstart your entrepreneurial journey.
Virtual Chicken Tender concept:
A virtual brand available exclusively for delivery through the third-party platforms DoorDash, Grubhub, and Uber Eats which comes in 14 craveable sauce varieties. The third-party delivery platforms provide means to reach consumers who prefer to eat at home.
It also offers boneless wings, chicken sandwiches, buffalo chicken salads, and beverages. The rise of this concept offers new opportunities for brands to expand their reach and offer new dining experiences.
Oven-Baked Tenders:
You can make anything more delicious, even an all-time family favorite, with this Oven-Baked Chicken Tenders concept. They’re the ultimate comfort food and perfect for any occasion, whether it’s a family dinner, a game night snack, or a party appetizer.
Combining the spices, crunchy Panko coating, and juicy chicken creates an easy dish that will surely become a crowd-pleaser.
5. Chicken Sandwich Franchises
This savory filling chicken bun has become the most popular chicken recipe in the United States, both in terms of total consumption and the number of servings. It’s a classic flavor combination that delivers an incredible taste experience, combining salt, fat, creaminess, and crunchiness all at once.
As a result, chicken sandwiches have been a staple in the food service industry, and the market for them has been heating up since 2019.
In fact, the global sandwich market is expected to grow significantly between 2023 and 2030.
Additionally, 30.13% of chicken restaurants offer sandwiches on their menus, making it a tried-and-true dish that continues to be in demand.
The data presented below will assist us in identifying the most popular quick-service restaurants (QSRs) for chicken sandwiches.
To take full advantage of this industry’s potential, explore the following unique concepts as excellent starting options for your venture.
Street Food-Inspired concept:
A new sandwich offering features crispy fried chicken strips, fresh cucumbers, Asian-style slaw, and gochujang mayo on a toasted rice flour baguette. This speaks to the growing popularity of street food-inspired offerings, which are favored for their convenience and unique flavor profiles.
It also inspires businesses to develop creative, on-the-go meal solutions that cater to time-conscious consumers.
Vegan Chicken Sandwich:
Packed with a crispy fried mushroom, fresh slaw, pickles & vegan honey mustard dressing. This vegan chicken sandwich is a fun twist on a classic fast food staple. A new and exciting way to enjoy a classic chicken sandwich is by replacing the chicken with mushrooms.
How to Start a Chicken Franchise
1. Research and evaluate chicken business ideas
Before starting your chicken franchise venture, it is essential to conduct thorough research and evaluate various business ideas within the industry. Identifying the most marketable concepts and gauging the market demand for the best chicken franchises around your area is crucial.
In addition to understanding the costs associated with the chicken franchises, including:
- the initial franchise fee,
- royalties,
- marketing costs,
- rent,
- and labor expenses,
it is equally important to investigate the training and support programs offered by potential chicken franchises.
A robust training system is crucial for ensuring that you and your staff are well-equipped to operate the franchise successfully. Consider the depth and quality of the training provided before committing.
Assessing the management structure of the chicken franchise and understanding the roles and responsibilities at both the franchisor and franchisee levels is also necessary. Clear communication and effective management practices contribute to the overall success of the franchise.
2. Apply for a chicken franchise
Once you have selected the ideal chicken franchise, you can apply for it. You should meticulously check the franchisor’s requirements. Ensure that you meet all criteria before proceeding with the application, as this step is vital in establishing a successful partnership.
3. Understand the FDD
Comprehending the Franchise Disclosure Document (FDD) is crucial as it provides detailed information on essential aspects, including:
Training and Support Program:
The document delineates the training and support programs offered by the franchisor, outlining the resources and assistance available to franchisees for their business operations.
Franchisees’ Revenue Data:
It presents financial data and performance metrics of existing franchisees, offering insights into the potential revenue and financial viability of the franchise opportunity.
Contact Details of Existing Franchisees:
The FDD includes contact information for current franchisees, enabling prospective franchisees to gather firsthand insights and perspectives on their experiences with the franchise system.
Terms of the Agreement:
Important contractual details are outlined, such as the duration of the agreement, renewal options, and any restrictions or obligations imposed on the franchisee.
A thorough understanding of the FDD is essential for prospective franchisees, as it provides a comprehensive overview of the franchise system and helps them make informed decisions about entering into a business relationship with the franchisor.
4. Sign the Franchise Agreement
A careful check of the FDD is necessary before signing the franchise agreement. It is a legally binding contract between the franchisor and the franchisee.
It is essential for franchisees to familiarize themselves with the fundamental elements, including the terms to establish a successful partnership with the franchisor.
Initial Term
The initial term refers to the period during which the franchisee is authorized to operate the business using the franchisor’s trademarks, systems, products, and services.
Typically, this period ranges from five to ten years, but it may vary depending on the type of business. This duration allows the franchisee a reasonable amount of time to establish the business, recoup their investment, and potentially achieve a return on their initial investment.
The key elements to consider during the initial term include the
- duration,
- rights and obligations,
- and support and assistance provided by the franchisor.
It is important to understand the length of the initial period and how it aligns with the franchisee’s business goals. The franchisee should ensure that they are aware of the rights granted to them by the franchisor and the obligations they must fulfill during this period, as outlined in the agreement.
Additionally, the franchisee should be aware of the ongoing support and assistance provided by the franchisor during the initial term, which can include training, marketing material, and regular check-ins.
Renewal Term
At the end of the initial term, there is often an option to renew the agreement for an additional term. The renewal terms cover the conditions under which the franchisee can continue operating the business under the franchisor’s brand.
It is crucial to familiarize oneself with the criteria that must be met to be eligible for renewal, such as:
- meeting performance standards
- and complying with the franchisor's system.
The franchisee should also be aware of the time frame for providing notice of intent to renew, as failing to provide timely notice can result in losing renewal rights.
It is equally important to be informed about any renewal fees that may be payable for extending the agreement and any potential updates to the terms of the agreement.
Therefore, comprehending the terms outlined in the franchise agreement, such as the initial terms and renewal terms, is critical for franchisees to ensure smooth operation and long-term success in their franchised business.
5. Choose a location for your chicken franchise
Choosing the right location is paramount for a chicken franchise’s success. Consider factors such as foot traffic, accessibility, and local demographics when choosing the prime location.
6. Hire and train staff
Once the location is secured, focus on hiring and training staff, ensuring that employees align with the franchise’s values and are adequately trained to provide excellent service.
7. Explore franchise financing
Exploring options helps determine the most suitable financial arrangement for your chicken franchise. You may consider these options to finance your chicken franchise:
Bank Loans
A widely preferred method for your franchise fee financing is through bank loans, which can be a viable choice if you possess a robust business plan and the financial capacity to meet regular loan payments.
Franchisor Financing
This option involves franchise-specific financing programs typically offered by extensive former franchise owners or networks with established ties to banks or investors. These programs empower individuals to secure the necessary funds for financing a franchise, facilitating the pursuit of their entrepreneurial aspirations.
Franchisors often extend assistance by providing access to discounted or even no-interest business loans to help cover the costs of purchasing a franchise.
SBA (Small Business Administration)
The SBA offers diverse loan programs specifically tailored to aid small business owners, including franchisees.
Designed to support the initiation or expansion of businesses, SBA loan programs, such as the 7(a) Loan Program and the 504 Loan Program, aim to provide capital and financing alternatives that are more accessible or cost-effective compared to traditional commercial loans.
8. Plan a grand franchise opening
This will help you attract customers and create a memorable introduction to the community, considering factors such as promotions, giveaways, and marketing strategies to ensure a successful and impactful launch.
Final Thoughts
2024 presents tremendous opportunities for investors and entrepreneurs, especially those looking to invest in franchised chicken restaurants.
This industry has demonstrated remarkable success, outperforming the well-known fast-food giants in generating revenue.
Despite variations in menu offerings and pricing strategies, the competitive landscape continues to evolve, providing franchisees with opportunities to capitalize on emerging trends and niche markets.
There are a few highly profitable chicken franchise ideas that you should consider to help you meet the ever-increasing demand for chicken.
By carefully planning and executing a diligent strategy, a chicken franchise could be a rewarding endeavor. It offers the potential for financial prosperity and personal fulfillment in the dynamic and ever-growing fast-food industry.
Your journey toward owning a flourishing chicken franchise begins here, stepping into the realm where crunchy and seasoned chicken captivates customers, boosts profits, and paves the way for your success.