Can You Finally Open a Panda Express Franchise? (Cost + Analysis)
Panda Express is one of the well-known brands in fast-casual for over 30 years. Globally, the corporation operates over 2,200 locations. Statista ranked as the third-best fast-casual restaurant in 2019
What is the price to start a Panda Express? Unfortunately, at the time of writing, this chain is not available for franchising.
In actuality, the vast majority of PE outlets in the US are owned by the firm. This indicates that staff members rather than a franchisee oversee daily business operations at a site.
What should you expect to pay if PE ever makes its restaurant franchises available to franchisees? Your liquid assets would need to be between $100,000 and $250,000 to buy this Restaurant.
The total investment ranges from $377,100 to $1,884,000, with the franchise costing $25,000 for Panda Express. These are, of course, estimations based on generic franchise models.
Detailed information about the restaurant, its operations, and it provided its annual revenue below if you’re interested. They included even the benefits and drawbacks of the idea in my list. Let’s get started.
Financial Conditions and Costs
It is a privately held corporation. They do not permit the franchising of their restaurant, and they have made none of the fees and regulations for the franchising public.
Financial Amount for the Fees and Expenses
Liquid Capital between $60,000 and $110,000
Total investment between $377,100 and $1,884,000
Twenty-five thousand dollars for a franchise
While this restaurant may not be available for franchising, it let its staff run the stores. If this implies that you must work for PE in order to be granted a franchise, no further information is given.
We’ll be the first to let you know if this change.
Average Annual Sales or Revenue
In 2020, it generated $3.5 billion in revenue, according to Forbes. Their prior years also saw billion-dollar sales growth.
The chain has experienced a similar expansion with double-digit percentage revenue growth. Even though sales decreased during the pandemic’s early stages and the lockdowns, the idea had a strong year-end.
Data on the Panda Express Franchise
- Overall Units 2,200+
- Organizational Name Intuitive Express
- Subsector Food and Drink
- Industry Fast-Casual Dining
- Since franchising Allows no franchising
The origins of this restaurant may be traced back to the 1970s, when Andrew Cherng and his father founded the Panda Inn in Pasadena, California.
A classy eatery serving Sichuan and Mandarin cuisine was called Panda Inn. Along with Peggy Cherng, they launched PE in 1983 as a fast-food alternative to Panda Inn. In the Glendale Galleria in Glendale, California, there was the first Panda Express.
The effective operating system of PE was created by Peggy Cherng, who holds a Ph.D. in electrical engineering and an M.S. in computer sciences.
Other Chinese-American restaurants at the time weren’t yet using Cherng’s inventory management and computerized system for reordering ingredients, which sped up and simplified the business process.
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The restaurant quickly expanded to 100 locations in its first ten years of operation. In Hawaii, the Ala Moana Center location of PE is regarded as one of the busiest.
According to reports, this area brings in $4 million annually. In 1997, Panda Express also began experimenting with drive-throughs.
In the beginning, mall food courts were the primary locations of restaurant chains. Opening in areas with a captive audience has long been a PE goal.
As a result, the business has set its sights on opening in places like casinos, amusement parks, airports, and university campuses.
Mexico City became the business’s first overseas presence in 2011. The Philippines, Canada, Japan, Puerto Rico, Guam, Dubai, South Korea, and the Philippines are more locations where Panda Express is available.
Revenues at Panda Express reached $1 billion for the first time in 2007. Around this period, Pasadena, California, saw the opening of its 1,000th location.
Orange chicken is the most well-liked dish at Panda Express. These chicken nibbles come with an orange sauce that is both sweet and hot. Since 2016,
they have sold more than 80 million pounds of orange chicken, according to their website. They also purchased 22 million pounds of broccoli in 2017.
Beijing Beef and Honey Walnut Shrimp are two additional dishes that are very popular. The eatery distributes fortune cookies with encouraging messages. PE distributes an astounding 282 million fortune cookies each year.
For their efforts to ensure food safety, the Asian restaurant company received the 2021 Excellence in Food Safety Award. Despite its rapid expansion,
PE is still seen as a family-run enterprise, led by Andrew and Peggy Cherng. With a combined net worth of $3 billion, the pair is now placed 838 on Forbes’ list of the world’s wealthiest people.
Two of the couple’s three children are employed at Panda Restaurant Group Inc., the holding company for Hibachi-san, Panda Express, and Panda Inn.
While Andrea Cherng serves as the chief marketing officer, Nicole Cherng oversees catering and special events.
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The business is well known for its generous giving. The philanthropic arm of Panda Restaurant Group Inc., Panda Cares, engages in a variety of charitable endeavors.
The group was established in 1999 with the goal of aiding underprivileged children and disaster relief operations by offering funds, food, and volunteer services.
Over $50 million has been donated to charity by the organization. Rosemead, California serves as the home base for Panda Restaurant Group Inc.
How Much Money Does Panda Express Make?
Although PE has not disclosed its profit figures, the restaurant chain’s net income in 2020 was estimated to be $8,000,000.
Chinese food is typically a profitable menu item, though we don’t know exactly how profitable a Panda Express is.
The majority of Chinese restaurants have a 3–4 times markup on their menu items. Keep in mind that this obviously does not account for the cost of labor, rent, or taxes.
Given PE’s dedication to maintaining a tight ship, I’m willing to wager that they’ve discovered a method to down their food prices even more than mom-and-pop Chinese eateries,
Which can overcharge food by a factor of three to four. PE currently benefits from economies of scale and can bargain with suppliers to lower the price of ingredients.
Background of Panda Express
The Panda Express website claims.
- 1983
- In Glendale, California, at the Glendale Galleria, the first Panda Express location opened.
- 1987
- Chef Andy Kao created the Orange Chicken entrée at Panda Express. This well-known American-Chinese meal, which is served in American-Chinese restaurants in many forms, is credited to Panda Express as having invented it.
- 1997
- In Hesperia, California, the first Panda Express drive-thru restaurant debuted.
- In 1998, Angel Stadium hosted the debut of Panda Express’s first baseball stadium eatery.
- The first Panda Express restaurant debuted at a theme park in 2001 at Valencia’s Six Flags.
- In Pasadena, California, Panda Express inaugurated its 1,000th location in 2007.
- 2011 saw the opening of Mexico City’s first Panda Express restaurant outside of Asia. The company now has offices in Guam, South Korea, Puerto Rico, Canada, and Dubai.
The Benefits of Owning this Restaurant
There would be many benefits to franchising a PE based on its multi-decade success. Here are a few of this restaurant’s greatest benefits.
My Orange Chicken Adventure
Orange chicken is a trademark of Panda Express, which sells 285,000 plates annually.
The most sought-after dish on the menu at the establishment is the one with the crispy skin and juicy bite covered in orange sauce.
They sell literally millions of pounds of the product each year, as was already revealed.
People still favor Panda Express partly because of the dependability of the food, even when independent Asian eateries provide the same items on their menus.
That the meal is served incredibly rapidly and can be picked up from a PE drive-thru outlet makes the experience more convenient.
Variety
If you’ve ever visited a PE, you’re already familiar with their huge menu. Beef, chicken, fish, veggies, noodles, and rice are all included as ingredients, with choices ranging from basic steamed rice to brown rice.
The portions are also large. Customers will come in hungry and leave highly satisfied if you are able to franchise a Panda Express in the future.
They’re not Giving Up
With more than 2,200 restaurants, you’d think Panda Express would be having trouble breaking into new areas. The restaurant chain, though, is still growing today.
In Owensboro, their most current branch has just opened. Being a member of the Panda Express franchise family means you’re in excellent hands because the business is expanding constantly.
Panda Express Franchise Challenges
Every company, even Panda Express, faces difficulties. These, in my opinion, are the main difficulties in franchising a Panda Express.
Lengthy Lines
Besides being known for orange chicken, it also linked Panda Express to lengthy lineups. There will always be a huge line of customers waiting to place orders at the food court or drive-through.
The large volume of traffic can turn away potential customers even though it is beneficial for business. When they notice the lengthy line, they’ll say, “Oh, well, let’s look somewhere else.”
Perhaps the restaurant is using the long lines as part of its marketing plan to draw in more guests.
However, there are times when huge queues might be a drawback and cause individuals to choose a different location that can hold them all at once.
Employment Litigation
Panda Restaurant Group Inc. has previously been the target of various lawsuits. These lawsuits dealt with harassment, overtime pay, and hiring discrimination.
Even though the firm settled these lawsuits, Panda Express’s reputation was harmed. If you ever consider owning a franchise, you should be aware of them.
Are You a Good Fit for a Panda Express Franchise?
Although PE is not now accepting franchise applications, if it does so in the future, this could be the ideal franchise for you.
The menu at PE is diverse and offers many fan favorites, including the orange chicken, which keeps customers coming back for more.
Panda Express would be one of the best prospects I’d look at if you were considering investing in an Asian-American restaurant franchise.
What is a Panda Express Franchise Alternative?
Check out Teriyaki Madness if you can’t wait till PE accepts applications from franchise operators.
This Asian-American chain has been in business since 2003 and has more than 150 locations across the country.
The eatery offers bowls of beef, chicken, or fish, as well as its unique take on orange chicken. Noodles, white rice, brown rice, fried rice, and more alternatives are also available.
Franchisees may also purchase Teriyaki Madness. For a single unit, a conventional 3-pack franchise costs $99,000, a 5-pack platinum franchise costs $150,000, and the franchise fee starts at $45,000.
Weekly royalties of up to 6%, depending on the gross sales figures you bring in, are another expense you should be aware of.
Conclusion
One of the most well-known American-Chinese fast food restaurants in the country, Panda Express has franchises in 34 states.
Licensed franchisees will profit from an extensive restaurant chain system and a well-known brand.
