Culver’s Franchise Costs, Fees & Owner Salary (2023)

INVESTMENT

$2,812,000

-

$6,867,000

LOCATIONS

944

Emily

Updated

May 2, 2024

Is

Culver’s

a franchise?

Yes,
Culver’s
currently
accepts
franchise
applications

Culver's is a distinguished franchise in the fast-food industry, celebrated for its distinctive menu and commitment to quality. Established in 1984 by Craig Culver and his family in Sauk City, Wisconsin, the brand has flourished, expanding its presence across 26 states. The inception of Culver's was driven by a simple yet powerful vision: to serve exceptional ButterBurgers® and Fresh Frozen Custard with heartfelt hospitality, aiming to support the Culver family's livelihood.

What sets Culver's apart in the competitive fast-food landscape is its unwavering dedication to freshness and quality. The franchise's signature offerings include ButterBurgers made from fresh, never frozen beef, and its Fresh Frozen Custard, crafted daily in each restaurant from the finest family farm-fresh dairy. This commitment extends across its menu, from whole, white meat chicken to Cheese Curds sourced from Wisconsin dairy farms, ensuring that every meal is a testament to quality and taste.

Culver's franchise model emphasizes active participation and hands-on management from its owner-operators. This approach ensures that each restaurant embodies the brand's core values of hospitality, quality, and community service, contributing to Culver's overall success. The franchise offers comprehensive support to its franchisees, from intensive training programs to ongoing operational assistance, ensuring each franchisee is well-equipped to meet Culver's high standards.

How many

Culver’s

franchises

are there?

In 2022, there were
944
outlets in
the United
States, of which
937
are franchises, and
7
are corporate-owned.

What are the

Culver’s

franchise

fees?

Advertising fee

6.50%

Initial Franchise Fee ($55,000)

The initial franchise fee for a standard Franchise Agreement with Culver's is $55,000. This fee is payable upon the execution of the Franchise Agreement.

Royalty Fee (4% of Gross Sales)

Franchisees are required to pay a continuing royalty fee of 4% of the Gross Sales of the Restaurant for each specified period.

Advertising Fee

  • Advertising Fee (2.5% of Gross Sales): Franchisees are required to contribute 2.5% of Gross Sales towards the Advertising Fee. This fee is payable monthly on or before the 10th day of the next month via EFT.
  • Cooperative Advertising (Up to 4% of Gross Sales): Franchisees may also need to contribute up to 4% of Gross Sales for Cooperative Advertising, as approved by a majority vote of the members of the Co-op Advertising Region.

E-Learning Program ($204 per quarter or $755 annually)

Franchisees will pay for access to the E-Learning Program, which is payable quarterly.

Additional Assistance ($500 per week)

This fee is for additional or special training or assistance requested by the franchisee.

Transfer Fee ($10,000 plus attorneys’ fees, $5,000 plus attorneys’ fees if the buyer is an existing franchisee)

This fee is payable before the completion of the transfer when the franchise agreement is transferred or assigned.

Renewal Fee ($30,000)

This fee is payable upon signing a successor franchise agreement.

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

Culver’s

franchise?

It costs between
$2,812,000
and
$6,867,000
to start a
Culver’s
franchise.

The total estimated initial investment required ranges from $2,524,000 to $7,228,000. The following table delineates the various expenditures associated with this investment:

Type of Expenditure Amount Range
Initial Franchise Fee $20,000 - $55,000
Land $435,000 - $2,085,000
Site Work $124,000 - $1,329,000
Building $1,277,000 - $2,600,000
Travel, Living and Expenses during Training $20,000 - $80,000
Initial Inventory $45,000 - $60,000
Furniture, Fixtures Equipment and Supplies $406,000 - $545,000
Sign Package $90,000 - $284,000
POS System $37,000 - $50,000
Miscellaneous Expenses $20,000 - $40,000
Additional Funds (working capital) - for 3 months $50,000 - $100,000
Totals $2,524,000 - $7,228,000

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

Culver’s

provide

training

to its

franchisees?

Yes,
Culver’s
provides
training

The franchisee, or the operator designated by the franchisee, is required to complete a full-time Franchisee Development Program at one of the company-owned restaurants.

This program is offered in three 16-week sessions each year and is aimed at ensuring that the franchisee or the operator is well-versed with the operational requirements of running a Culver’s® Restaurant. There is no charge for the Franchisee Development Program, although the franchisee is responsible for all travel and living expenses during this period.

Additionally, the franchisee must attend or participate in any periodic reconnection training courses or programs designated by the franchisor. There may be charges for additional training requested or necessary for new or existing managers hired after the restaurant opens.

Furthermore, the franchisee is required to subscribe to any electronic training program provided through the franchisor's online support center, which includes all future updates, supplements, and modifications to the training program.

Does

Culver’s

provides

territory

protection?

Franchisees may only operate their Restaurant at a specific location and will typically receive a "Designated Territory" that is usually a 3-mile radius around the location of the Restaurant. This radius can be adjusted based on certain factors such as physical barriers or population density.

While franchisees have a Designated Territory, they might encounter situations where other Culver’s® outlets serve customers residing within their territory without any compensation to them.

Additionally, franchisees can sell certain Culver’s® menu items from authorized locations other than their Restaurant within the Designated Territory, but only with the company's advance written consent and under its written guidelines.

Can a

Culver’s

franchise

be run as

a passive

investment?

Culver’s mandates that if the franchisee is an individual, they must be present and engaged full-time on-site as the owner-operator and personally manage the Restaurant unless prior consent is obtained to delegate this authority.

If the franchisee operates more than one Restaurant, they may delegate certain management duties for additional Restaurants to one or more managers approved by Culver’s.

If the franchisee is a corporate entity or a partnership, one individual, termed as the "Operator," must retain at least 50% of the equity and voting interest in the entity and is obligated to be the full-time on-site Operator who personally manages the Restaurant.

In summary, while a franchisee can recruit managers for daily operations, a designated Operator with a significant equity interest and active involvement in the day-to-day operations is required, ensuring adherence to Culver's operational standards and procedures.

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