Vetted Biz is the leading platform for accessible and analytical data on franchises and businesses available in the U.S. Our research team has reviewed over 2,900 franchises and knows the key facts and data that signal a successful A franchise is when a business (franchisor) allows a party (franchisee) to acquire its know-how, procedures, processes, trademarks, intellectual property, use of its business model, brand and rights to sell its products and services. The franchisee signs a contract (franchise agreement) with the franchisor to acquire the franchise and generally has a territory granted to operate. What is a Franchise?... More system. Upon extensive review using a number of internet research tools, our team was able to compile a short list of the “Top 20 Most Popular Franchises in the United States.” In the article below, we review the business model proposed by one of these 20 franchises: Sonic Drive-In, as well as the requirements that encompass its franchise application process.
Sonic was founded in 1953, by Troy Smith Sr. in Shawnee, Oklahoma. The drive-in restaurant experienced success as soon as it opened, and right after, Smith Sr. brought in the franchise’s new partner – Charlie Pappe. The partners decided to begin franchising in 1959, in order to continue expanding Sonic Drive-In’s business model of selling unique hot dogs, burgers, chicken sandwiches, tater tots, onion rings and breakfast items to its customers. 67 years later, Sonic now has over 3,400 restaurants located across 46 U.S. States. The company is currently headquartered in Oklahoma City and is led by its Chief Executive Officer, J. Clifford Hudson, who was been with the company since April 1995.
The first factor to consider when interested in investing in a Sonic Drive-In franchise are the financial requirements accompanying this investment opportunity. The total investment amount to establish a Sonic Drive-In franchise ranges from $1,242,000-$3,523,300 including the company’s franchise fee that is $45,000 and excluding any land or lease costs. Once the store has been built and operations begin, franchisees are then expected to pay the parent company a royalty fee ranging from 2.45-5.00% on gross The total amount in dollars made in the business before expenses are deducted. See also Gross Revenue...., and an additional marketing fee of 3% on gross sales in exchange for the marketing services provided by the franchisor. The franchisor is particularly looking for experienced candidates who are truly driven to own a Sonic Drive-In franchise. Additionally, the minimum Value of all the non-financial and financial assets of a business buyer. There is usually a minimum net worth requirement to qualify as a franchisee and for bank financing.... required to own a Sonic Drive-In Franchise ranges in between $1,000,000-$2,000,000 and the applicant must have liquid assets totaling at least $500,000-$1,000,000.
When evaluating a Sonic Drive-In franchise’s potential for growth one does not need to go beyond Quick Service Restaurant numbers to better understand the prospect for success of the opportunity at hand. The fast-food industry generated $200 billion in revenues in 2015 and the industry has since been expected to have an annual growth of 2.5% for the following subsequent years. Additionally, Sonic Drive-In has been ranked number 13 on the QSR Magazine for Top Franchises in 2019 maintaining its position up high since the early 2000’s. Looking at the franchise’s internal performance, the average gross sales for franchised units in 2018 was of $1,268 out of which 43% of franchisees either met or exceeded this average. Additionally, in 2018 only 33 franchises ceased operations for other reasons – a minimal number when compared to the franchise’s overall 3,424 units. Moving forward, Sonic Drive-In is looking to establish new units across the country and particularly in sites where their target audience is more concentrated around.
Investing in a Sonic Drive-In franchise is definitely a unique and very attractive opportunity, especially for individuals who are driven to lead a top ranked business that makes extremely significant annual revenue numbers. Sonic Drive-In’s name value is remarkable, and all current franchisees have made positive reviews given their experience! That said, if you are an individual with previous business management experience and are willing to invest an amount ranging $1,242,000-$3,523,300 or more, Sonic Drive-In is the right franchise for you!