Food & Beverage
Dave's Hot Chicken Franchise
Nashville-style hot chicken tenders and sliders served in a fast-casual format, primarily franchised as multi-unit Area Development agreements requiring a minimum of three restaurants.
Every franchisor has to file a document called an FDD before they can legally sell you a franchise. Buried in it are the two things a sales rep won't volunteer: what you'll actually spend to open, and whether existing locations are opening or closing. That's what's below, pulled straight from Dave's Hot Chicken's own filing.
What it costs to open
From the filing's investment breakdown -- not a "starting at" number a sales rep quoted you.
Franchise fee
$40,000
Total to open
$619,800–$1,963,000
Ongoing royalty
6% of gross sales
What you'd actually spend, over time
The upfront cost is only part of it. Plug in what you expect a location to bring in, and see the real total once royalties over a few years are added on top.
Used to work out your royalty payments and your profit estimate below -- we don't assume a number for you.
Total cost of ownership over 5 years
$769,800 – $2,113,000
Startup investment
$619,800–$1,963,000
Royalty per year (6%)
$30,000
Total royalty, 5yr
$150,000
When would you break even?
Revenue alone doesn't tell you this -- it depends on what's left after rent, labor, and everything else. Dave's Hot Chicken's FDD doesn't disclose a reliable profit figure (most franchisors don't), so this starts from a typical food & beverage profit margin (~8%) and applies it to the revenue you entered above -- adjust the percentage to your own realistic estimate.
Defaulted to a general food & beverage industry benchmark, not a figure from Dave's Hot Chicken's own filing -- this is a starting point to adjust, not a promise about what franchisees actually make.
At that profit, you'd break even in about
15.5–49.1 years
Weigh that payback period against what you already know: Dave's Hot Chicken is opening more locations. A long payback period on a shrinking brand is a very different bet than the same payback period on a growing one.
Is Dave's Hot Chicken actually growing?
Franchisors have to report, every year, how many locations opened, closed, or changed hands. Most franchise sites never show you this. Here it is:
Locations opened vs. closed, by year
GrowingFrom Item 20 of Dave's Hot Chicken's FDD, the section franchisors use to disclose real openings and closings.
| Year | Franchised units, start | Franchised units, end | Net change |
|---|---|---|---|
| 2021 | 1 | 22 | +21 |
| 2022 | 22 | 78 | +56 |
| 2023 | 78 | 146 | +68 |
Most recent year (2023): gained 68 franchised units, ending the year at 146 total.
Where this came from: California DFPI Registration Renewal, App ID app-30622, filed 3/20/2024, effective 11/13/2024. You can pull the same filing yourself from the California DFPI's public franchise search. Filed 2024-03-20. None of this is investment advice -- get the franchisor's current FDD and talk to a real attorney or accountant before you sign anything.
If you see a different unit count elsewhere: franchisors only have to refile their FDD annually, so the numbers here can run 6–18 months behind a franchisor's own real-time marketing claims -- which often aren't independently verified, and sometimes count signed-but-not-yet-open locations. A gap isn't necessarily an error on either side; it's two different snapshots in time from two different sources.