How Much will it Cost to Open a Waffle House in 2022?

The legendary American restaurant franchise, Waffle House, is well-known for offering breakfast and being open around-the-clock, every day of the week. Continue reading to learn more about Waffle House’s statistics and why it has such strict standards for franchising.

Waffle House Financial Requirements and Costs

Given that Waffle House is not currently available for franchising and that little is known about the costs of this restaurant. The following is a brief explanation of the funding needs and fees of Waffle House.

An initial investment of between $317,750 to $600,000 is anticipated. The leasehold improvement, kitchen equipment, furnishings, and franchise location deposit make up the bulk of the fees.

The cost of the leasehold upgrades ranged from $175,000 to $375,000, which corresponds to a space in an existing retail complex ranging from 1,800 square feet to 2,800 square feet.

This cost is influenced by a number of variables, including new construction, the state of the existing building, the size of the space, the cost of the materials, the pay paid to the workers, and the geography of the site.

Financial Requirements and Costs

Additionally, it is assumed that the landlord will pay for water, gas, and sewage services at this cost.

These aspects should be taken into consideration when deciding on your location because they will have a big impact on your overall investment costs.

The cost of kitchen furnishings and equipment, which can be anywhere between $60,000 and $90,000, is the second expense.

This assumes a one-time purchase while leasing the equipment can be more cost-effective.

Last but not least, the rent and security deposit for a franchise store ranged from $5,000 to $20,000. Whether your restaurant is in a mall or another type of location will affect the rent or security deposit.

All of these expenses rely on where you choose to locate your franchise, and some of them are negotiable depending on your choices for each line item.

About the Waffle House Franchise

Waffle House, also known as WH Capital, L.L.C., is a restaurant company with 2,100 locations in 25 states across the United States.

The majority of their outlets are in the American South, where the brand has a strong cultural presence. The Atlanta Metropolitan Area in Georgia serves as the chain’s headquarters.

On the weekend of Labor Day in 1955, the first Waffle House debuted in Avondale Estates, Georgia. Joe Rogers Sr. and Tom Forkner were the people that created and opened that eatery.

In 1947, Rogers began working as a short-order cook at the Toddle House in New Haven, Connecticut.

Waffles were the most lucrative item on the 16-item menu, so Forkner suggested renaming the eatery “Waffle House.”

The delicate nature of the waffles also served to emphasize that it was a dining establishment and not a takeout establishment, but it left customers wondering about additional meal options.

To prevent a conflict of interest, Rogers continued to work for Toddle House but in 1956 sold his stake to Forkner.

Rogers returned to Atlanta and joined Waffle House, then a chain of three restaurants, to manage operations in 1960 after asking to purchase a stake in Toddle House and being turned down. Tom soon after Joe went back to work full time.

The business started franchising its restaurants in 1960 when it opened its fourth location, and it gradually expanded to 27 locations by the late 1960s before its expansion accelerated.

The privately held company says it serves 2% of the eggs used in the country’s food service sector but withholds its annual sales numbers.

How to Open a Waffle House Franchise

1. Make sure you have enough capital.

You need a capital of $600,000 to start a Waffle House restaurant franchise.
Recognize the financial commitment needed for a restaurant franchise.

You must take into account costs associated with purchasing real estate, purchasing tools, and signs, obtaining licenses and permissions, purchasing uniforms, purchasing insurance, etc.

2. Consider your past expertise and strong points.

Before submitting an application to open a Waffle House restaurant franchise, you should carefully assess your prior business experience.

3. Analyze the supply in the market.

Before moving forward with the franchising application, you should check the Waffle House franchise market availability to see whether there are any markets in your target location.

4. Send your application in.

The Waffle House franchise team will examine your application. Upon receiving your online application, you will receive a confirmation email. In this email, we will also include the franchise owner’s contact information.

5. Get the go-ahead to start your Waffle House franchise.

Following the conclusion of your background and financial checks, you will be granted franchise clearance. Only applicants who fully satisfy the standards of franchise owners will receive approval.

Average Sales and Profit Yearly

Because Waffle House’s chairman, Joe Rogers Jr., is secretive about their sales numbers, it can be challenging to find out the most recent average sales figures.

But according to a Forbes report from 2020, Waffle House typically brings in about $1.3 billion annually.

Private owners own Waffle House. Aside from the report we quoted above, which showed that Waffle House generates about $1 billion in gross revenue yearly, they don’t disclose their average annual income to the general public.

The best we can do is compare the profit margin to other restaurants to determine how much profit the company produces based on that revenue.

The Restaurant Resource Group estimates that a profit margin of 2% to 6% can be anticipated. Using this basic calculation as a benchmark, Waffle House would make $40 million per year even with a 4% profit margin. 

They have also revealed that they use 2% of all eggs produced in the US, which further demonstrates the size of the industry.

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Advantages of the Waffle House Franchise

You might be curious about the benefits of running this franchise in your community if you manage to secure a Waffle House franchise.

When you have a license to operate them, Waffle House will make you proud in the following ways, to name a few.

A Classic Legend

Particularly in the southern regions of the country, Waffle House is well known. Everyone can eat breakfast there at any time of the day; it is a local landmark.

Waffle House has so far made a name for itself as a timeless classic restaurant that everyone seems to appreciate, so you can already expect that when you own a Waffle House, you won’t need to work as hard in getting the name out there.

Has a Reasonable Menu

Comparing Waffle House to its rivals, it is thought to be less expensive. For instance, a plate of waffles at IHOP costs $6.79, whereas waffles at Waffle House cost $3.70.

At Waffle House, every other item is likewise less than $11. With this pricing, you may position the Waffle House in your community as an inexpensive alternative to other well-known breakfast franchises.

It is Always Open

People today simply don’t go to bed by 9 o’clock. Many of the folks who are still awake and active when it is time for bed may be looking for a place to eat.

Waffle House has traditionally been known to be open every day of the week, including holidays.

Your Waffle House location may be the destination for everyone following a night out with pals, which is bringing in the crowds well beyond midnight and boosting business.

Disadvantages of Waffle House Franchise

We’d want to be up forward and tell you that every business will experience ups and downs. You will encounter difficulties if you own a franchise. Here is what to anticipate.

Capital

Although said before, the total price to franchise a Waffle House is between $600,000 and $1.00 million.

Please keep in mind that the numbers are only estimates. However, consider how much it would cost to run a Waffle House and whether it would fit into your budget.

The majority of franchise opportunities fall within this basic range of investment.

Menu Options

Many people agree that Waffle House’s food is delicious. There isn’t any issue there. But there are certain restrictions on the menu options.

There aren’t many options available. For example, despite being a breakfast restaurant, there are no pancakes or French toast available.

Location

You would need to have a fantastic site to build your store because Waffle House picks the best spots. However, a premium location also means an expensive lot to rent or buy, which could result in increased costs.

Things to Consider Before Joining Waffle House

There isn’t much information available on Waffle House’s profitability, but the company’s yearly revenues of $1 billion should be a fair indicator that it’s worthwhile.

Should you be selected to run a branch, you should also think about the expense of franchising this breakfast franchise.

The difficulty of running a restaurant that is open 24/7 is another item to think about. The night manager might call you if an oven malfunctions at two in the morning.

Many breakfast establishments are only open from 6 am until 2 pm, giving you a break.

Furthermore, you must consider the vast array of operational difficulties that come with operating a 24/7 firm like this.

For enterprises in the service sector that only operate during the day, staffing has become a problem.

You will require management, culinary personnel, and wait-for staff around the clock if your restaurant is open 24/7. This calls for greater time and effort to be put into scheduling, hiring, and dismissing.

Consider if you wish to serve this clientele before proceeding. As you are aware, both wealthy and less wealthy diners like eating at the Waffle House.

The Waffle House model is all about dine-in service, unlike all the other quick-serve concepts that do more drive-thru business.

Although we’ve seen over the past year, having a business that caters to drive-thrus can help you make more money more quickly.

Frequently Asked Questions