Here's How Much Five Guys Franchise Owners Really Make Per Year

The popular burger and fries chain Five Guys is growing at a rapid rate, not just in the United States, but abroad too. And if you're lucky enough to own a Five Guys franchise, then you can expect to make a very healthy income.

Five Guys makes it pretty clear to franchise owners that the company won't pinpoint an exact number on what owners can expect to make based on previous sales history, but that doesn't mean some of the data isn't out there. A franchisee who is at the top of their game can expect their store to make up to $1.18 million annually in sales, which is pretty amazing.

Of course, sales don't equal income, and operators have to account for all those overhead costs like keeping the lights on and paying staff to sweep up peanut shells a hundred times a day. Five Guys also takes a gross sales royalty of 6 percent, which is worth bearing in mind if you're thinking of signing up for the franchise. Considering that the median income for a food franchise owner is around $126,866 a year, we can reasonably expect a Five Guys franchisee to earn close to that amount.

Before owners can make that kind of money with Five Guys, though, they first have to convince the company that they're worthy of sitting at the table. Buying a Five Guys franchise, or really any fast food franchise, isn't cheap. In comparison, opening one doesn't cost as much as a Wendy's or Chick-fil-A, but it's still a pretty penny.

For starters, the franchise fee is $25,000, and franchisees can expect to make an initial investment of between $306,000 to $641,000. This cost has only gotten more expensive as the chain's popularity has skyrocketed. In 2012, the franchise fee was $5,000 less, however, those who were interested were expected to already have a hefty net worth of at least $1.5 million, as well as liquidity of around $500,000, according to Forbes. And it's important to note that Five Guys doesn't offer any help with financing.

Franchisees operate more than 900 Five Guys restaurants, and that number is expected to keep growing as more applications are reportedly flowing in every day. While it does cost a lot to open one, the pay off is pretty good, especially if you own more than one restaurant.

Five Guys sold out of all its North American franchise rights shortly after opening the franchise doors, and people have been clamoring to get a piece of the pie ever since. If you have the funds and a serious love of burgers, Five Guys might be the right fit for you. Just know that you won't be running a single store, but five at the very minimum.

The the company also has some pretty hefty terms in its franchise contracts. Company founder Jerry Murrell told Inc.,

"I don't know if I would ever sign it. We can get out of the deal a million ways, but they are stuck."

Aside from taking a sales cut, the company also regularly puts its franchised stores through weekly secret shopper and safety checks.

Considering just how wildly popular Five Guys has become, it's almost hard to believe that its U.S. takeover might not have ever happened. For a fast food restaurant to really grow, franchising is almost a necessity, but Five Guys was initially against it. Murrell had worked incredibly hard to get his burger restaurants running and profitable in northern Virginia, and the idea of turning it over to outsiders was a risky move he wasn't sure he was ready for. Murrell told Forbes in 2012,

"I just wasn't sure I could get strangers to buy into our concept. Everyone came in with their own opinions about what should be on the menu."

Murrell was reluctant, but his son Matt, who was helping him run the business, was wise enough to see the potential and bought his father a copy of Franchising for Dummies. The book was co-written by Wendy's founder Dave Thomas, and gave Murrell the push he needed to welcome franchise investors into the fold. And the rest is pretty much burger history.

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