Jack in the Box Franchise Costs, Fees & Owner Salary (2023)

INVESTMENT

$1,766,000

-

$2,762,000

OPERATING PROFIT

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Emily

Updated

February 9, 2024

Is

Jack in the Box

a franchise?

Yes,
Jack in the Box
is a franchise and
currently
accepts
franchise
applications

Jack in the Box is a notable name in the quick-service restaurant (QSR) industry, recognized for its innovative and diverse menu offerings that span across five different dayparts, making every item available all day, every day. Founded in 1951 and commencing its franchising journey in 1982, the franchise has established a robust presence.

Headquartered in San Diego, California, Jack in the Box has cultivated a unique niche within the burger-centric QSR segment by offering a wide range of items including their signature Sourdough Jack and Jumbo Jack burgers, alongside tacos, 24-hour breakfast options, chicken sandwiches, egg rolls, salads, shakes, and their famed curly fries.

What sets Jack in the Box apart in the competitive fast-food landscape is not only its expansive menu but also its commitment to bold flavor fusions, quality, and fresh preparation. The brand has been acknowledged for its innovation and was named the 2022 Transformational Brand of the Year by QSR Magazine, highlighting its significant impact and growth within the industry.

Jack in the Box's approach to franchising emphasizes flexibility, innovation, and support, making it an attractive opportunity for entrepreneurs with a strong business acumen, a passion for the brand, and the ability to meet its financial requirements. The brand's ongoing expansion and adaptation to the evolving QSR landscape continue to make it a compelling choice for potential franchisees looking to invest in a proven and dynamic business model.

How many

Jack in the Box

franchises

are there?

In 2022, there were
2208
outlets in the United States, of which
2036
are franchises, and
172
are corporate-owned.

What are the

Jack in the Box

franchise

fees?

Initial franchise fee

$50,000

Royalty fee

5.0%

Advertising fee

5.0%

Initial Franchise Fee ($25,000 for Traditional Restaurant, $25,000 for Non-Traditional Restaurant)

The initial franchise fee for a standard Franchise Agreement with Jack in the Box is $25,000 for both Traditional and Non-Traditional Restaurants. This fee is payable in full upon signing the License Agreement and is not refundable under any circumstances.

Royalty Fee (5% of Gross Sales, with variations under certain programs)

The standard royalty fee is 5% of Gross Sales. However, under certain programs like the Development Incentive Program, the royalty fee can be reduced to as low as 1% for the first year, increasing gradually to 4% in the fourth year, and returning to 5% thereafter.

Similarly, existing franchisees as of March 23, 2021, who sign a Multi-Unit Development Agreement before October 1, 2023, can enjoy a royalty reduction, starting at 0% for the first three years and gradually increasing to 5% from the sixth year onward.

Advertising (5% of Gross Sales)

Franchisees are required to pay a marketing fee equal to 5% of Gross Sales. This fee is payable monthly on the 15th day of the next month for traditional locations, and weekly on Friday for the prior week for non-traditional locations.

Transfer Fee (Up to $2,500 per restaurant)

Upon the sale of a franchise or other transfer, a transfer fee is applicable. This fee is up to $2,500 per restaurant.

How much does

it cost

to start a

Jack in the Box

franchise?

It costs between
$1,766,000
and
$2,762,000
to start a
Jack in the Box
franchise.

The total estimated initial investment for a traditional Jack in the Box restaurant ranges from $1,765,500 to $2,761,600. Below is a detailed breakdown of the costs involved:

Type of Expenditure Amount
Initial Franchise Fee $50,000
Fee for trade area survey analysis $0 - $7,000
Fee for architect/engineering services $49,000 - $166,000
Environmental assessment $2,500 - $34,000
On-site improvements $286,000 - $507,000
Building Improvements $611,000 - $785,000
Furniture, fixtures and equipment $415,000 - $530,000
IT equipment and installation $45,000 - $60,000
Computer-related services and licensing $1,000
Initial inventory $12,000 - $20,000
Pre-opening training and inventory expenses $110,000 - $115,000
Pre-opening additional funds $14,000 - $17,000
Uniforms $3,000 - $5,000
Operating cash $1,200 - $3,000
Business licenses and utility deposits $500 - $3,000
Additional funds (3 months) $165,300 - $458,600
Total $1,765,500 - $2,761,600

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

Jack in the Box

provide

training

to its

franchisees?

Yes,
Jack in the Box
provides training to its franchisees.

The training program for franchisees at Jack in the Box is comprehensive and involves various stages to ensure that the franchisee and their employees are well-prepared to operate the restaurant. Here's a breakdown of the training program:

  1. New Franchise Operator Training Program:

    Before the restaurant opens, the Franchise Operator (or, if applicable, a Designated Market Operator) is provided with pre-opening training. The training program lasts approximately ten to fourteen weeks (560 hours) and is offered as needed. Training takes place in San Diego, California, Dallas, Texas, or Los Angeles, California, at the discretion of the company.

    The cost of this training is included in the Initial Franchise Fee, but the franchisee is responsible for paying travel, living, and personal expenses while taking the training programs.

  2. Certified Franchise Restaurant Manager Training:

    Before the restaurant opens, one employee is provided training to become a Certified Franchise Restaurant Manager. The training can take place in San Diego, California, or in some instances, at a location closer to the franchised restaurant. The cost of the initial training of one restaurant manager per restaurant is included in the Initial Franchise Fee.

  3. Additional or Refresher Training:

    The franchisee, Designated Market Operator, and/or one Certified Franchise Restaurant Manager may be required to attend additional or refresher training programs. If such training is required, it is offered without charge, but the franchisee will be responsible for any travel, living, and personal expenses incurred during the training.

Does

Jack in the Box

provides

territory

protection?

Franchisees are granted the right to operate a Jack in the Box Restaurant within a specific location. The Single Unit Development Agreement is signed for each location and grants franchisees the right to construct a single Jack in the Box restaurant within the Development Area. This Development Area could be a specific site or a larger area agreed upon and described in the Agreement.

The Company will not grant new Jack in the Box franchises to any person or entity other than the franchisee for the operation of, and the Company will not open, any new Jack in the Box restaurant within the Development Area. However, if the Company or any other franchisee already operates one or more Jack in the Box restaurants within the Development Area, there are no guarantees of exclusivity.

Can a

Jack in the Box

franchise

be run as

a passive

investment?

Jack in the Box requires a designated "Operator" for each franchised restaurant, who may be the franchisee, someone else who has signed the Franchise Agreement, or, in some cases, someone designated by the franchisee.

This Operator must hold an ownership interest of at least 25% in the franchised business and should be highly experienced in the quick-service restaurant industry.

In certain circumstances, if the franchisee is qualified to be an Operator, has two years of ownership experience, and does not live in or near the Designated Market Area, they may be allowed to name a Designated Market Operator to operate the restaurant.

This Designated Market Operator need not hold an ownership interest in the franchised business.

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