Baja Fresh Franchise Costs, Fees & Owner Salary (2023)

INVESTMENT

$208,000

-

$1,113,000

LOCATIONS

78

Emily

Updated

May 2, 2024

Is

Baja Fresh

a franchise?

Yes,
Baja Fresh
currently
accepts
franchise
applications

Baja Fresh, established in 1990, is a renowned franchise in the fast-casual dining sector, celebrated for its unwavering commitment to freshness and quality within the realm of Mexican cuisine. The brand differentiates itself by ensuring that its kitchens are devoid of freezers, microwaves, or can openers, underscoring its philosophy of using only fresh, handpicked ingredients.

This approach is a stark contrast to the industry norm, which often relies on pre-packaged and frozen components, allowing Baja Fresh to carve out a unique niche by catering to the health-conscious consumer who values both nutrition and flavor in their meals.

With its headquarters located in Scottsdale, Arizona, under the management of MTY Franchising USA, Inc., Baja Fresh has made a significant impact on the market with its fresh take on traditional Mexican fare. The franchise's menu is an array of Mexican staples, including burritos, tacos, and salads, alongside a selection of signature dishes designed to appeal to a wide audience seeking healthier dining options.

Baja Fresh began its franchising journey shortly after its inception, inviting investors to partake in the burgeoning fast-casual restaurant industry. The brand emphasizes the growing popularity of Mexican cuisine in the United States, positioning itself as a frontrunner in delivering fresh, high-quality Mexican meals.

How many

Baja Fresh

franchises

are there?

In 2022, there were
78
outlets in
the United
States, of which
67
are franchises, and
11
are corporate-owned.

What are the

Baja Fresh

franchise

fees?

Advertising fee

4.00%

Initial Franchise Fee

The Initial Franchise Fee is Thirty Thousand Dollars ($30,000). It is payable upon the execution of the franchise agreement through cashier's check, wire transfer, or other immediately available funds.

Royalty Fee

Franchisees are required to pay a weekly Royalty Fee equal to five percent (5%) of total Gross Sales. This fee is ongoing for the duration of the franchise term, starting from the later of the effective date or the date the franchised business opens to the public.

Management Fee

In cases where the franchisor assumes the management of the franchisee's business, a Management Fee equivalent to 6% of the Franchised Business' Gross Sales, in addition to the Royalty and Advertising Fees, will be applicable. This fee also includes the franchisor's direct out-of-pocket costs and expenses.

Transfer Franchise Fee

For a full transfer of the franchise to a new franchisee, a Transfer Franchise of $15,000 is required. This fee is due prior to the completion of the transfer.

Renewal Franchise Fee

Upon renewal of the franchise agreement, a Renewal Franchise Fee equal to 50% of the then-current initial franchise fee, excluding any discounts or reductions, is payable.

Relocation Fee

If the franchisor approves the relocation of the franchise store, a Relocation Fee of $5,000 is applicable.

Note: The fees presented here can be found in the Item 5 of the Franchise Disclosure Document. For a complete list of all the fees borne by the franchisee, please consult the Franchise Disclosure Document.

How much does

it cost

to start a

Baja Fresh

franchise?

It costs between
$208,000
and
$1,113,000
to start a
Baja Fresh
franchise.
Type of Expenditure Amount
Architect; Engineer; Drawings $15,000 - $25,000
Permits $5,000 - $32,000
Base building, Interior Improvements; Lighting; Tile; Millwork $80,000 - $507,150
Signage $10,000 - $17,000
POS System $11,000 - $20,000
Computer System $800 - $1,200
Kitchen Equipment; Smallwares; Furniture $90,000 - $288,750
Inventory; Uniforms $4,000 - $8,000
Advertising $2,500 - $10,000
Legal Fees $1,000 - $3,000
Initial Franchise Fee $12,000 - $30,000
Depository Account $3,000
Lease Review Fee $0 - $2,500
Grand Opening Marketing $10,000
ADDITIONAL FUNDS (3 months) $42,400 - $73,500
Grand Total $310,310 - $1,071,190

Note: The table above provides a snapshot of the main costs associated with starting the most common franchise format (as disclosed in the Item 7 of the Franchise Disclosure Document). For a complete overview of all the expenses involved with the various formats offered by the franchisor, please consult the Franchise Disclosure Document.

Does

Baja Fresh

provide

training

to its

franchisees?

Yes,
Baja Fresh
provides
training

The franchisor provides a comprehensive training program for franchisees that includes both "In-Store Training" and "New Owner Training"

The In-Store Training consists of approximately 240 hours, where trainees learn the operational aspects of running the franchised business. This hands-on training covers various aspects of day-to-day operations, including food preparation, customer service, and store management.

The New Owner Training encompasses around 40 hours and is designed to educate the franchisee on the fundamentals of operating the franchise. This part of the training program may be conducted online or in person, depending on the franchisor's discretion. If conducted in person, the training usually takes place at the franchisor's training and education center in Scottsdale, Arizona, or another designated location.

Franchisees are responsible for all transportation, food, lodging, and other personal expenses incurred during the training. The training program is mandatory for up to two individuals associated with the franchise, with at least one having an ownership interest in the franchised business.

In addition to the initial training, the franchisor may require franchisees and their managers to attend additional training sessions if the franchised business is not operating up to the franchisor's system standards. 

Furthermore, the franchisor may offer refresher or additional training programs, conferences, and seminars on various subjects such as new products, sales and marketing techniques, and merchandising procedures. Attendance at these programs is mandatory, and they are typically held in the metropolitan Phoenix, Arizona area or other locations in the United States as chosen by the franchisor.

Does

Baja Fresh

provides

territory

protection?

The Baja Fresh Franchise Disclosure Document outlines that even if a franchise agreement grants a territory to the franchisee, the franchisor may still retain the right to compete within that territory. This means that the franchisor could potentially open its own outlets or grant franchises to other individuals within the designated territory of an existing franchisee.

Therefore, while there may be some level of territorial consideration, it does not guarantee absolute protection from competition within that territory by the franchisor itself.

Can a

Baja Fresh

franchise

be run as

a passive

investment?

The Baja Fresh franchise system emphasizes active participation and direct operation of the franchise by the franchisee or a significant stakeholder within the franchisee's business organization.

While the Franchise Agreement may not explicitly mandate personal involvement in the day-to-day operations, the franchisor's intention is to partner with individuals who are committed to actively participating in the daily affairs of their Baja Fresh Restaurant.

This includes on-premises supervision and direct management by either the franchisee, a partner, a shareholder, a member of the franchisee's business organization, or a manager who has successfully completed the franchisor's Training Program.

Related Posts