Franchise Strategies
Aug 12, 2025
Investing in a regional burger chain comes with significant costs, risks, and operational challenges that potential owners should carefully consider.
Putting cash into a Culver's shop can draw you in with its true fan base, Midwest feel, and push for good work. But it comes with tough spots. Here's what you should know:
Costs: You might pay $20,000 to $55,000 at first, but the whole spend could reach $2.6M–$8.5M. You also need to show you're worth $1.25M–$2M and have at least $500,000 ready to use.
Ongoing Fees: Plan for monthly cuts of sales (4%), ads fees for the nation (2.5%), and other charges like tech costs ($600–$1,000).
Risks: Few people know the brand far from the Midwest, lots of rivals in full markets, and tough work needs (like high pay for custom orders).
Growth Limits: Often, owners can't grow much past set areas.
Daily Work: You must manage the place, train your team, and deal with lots of staff leaving.
Main Point: Even though Culver's might grow in spots not yet used much, the big spends, hard work needs, and space limits make it a gamble for many. Think hard about your cash, time, and local shop scene before you jump in.
Culver’s Franchise Cost & Fee Justified By Growth
How Much It Costs to Own a Culver's
When looking at the risks of local chains, it's key to know what you pay for a Culver's franchise. The cost is more than just the first fee.
Fees and Full Costs
To own a Culver's, first, you must pay a start fee from $20,000 to $55,000. But that's just the start. You need between $2,642,500 and $8,573,000 in total. This big range is because of things like the place, the size, and if you buy or rent the site.
With these first costs, you also have a few each month, such as:
Service fee (royalty): 4% of what you make
National ad fee: 2.5% of what you make
Tech fee: From $600 to $1,000 each month
Group ad fees: Up to 4% of what you make, based on local group join-in
Type of Regular Fee | Fee Amount | How Often | Extra Info |
|---|---|---|---|
Fee for Service (Royalty) | 4% of all sales | Each Month | |
Ad Fee (For All) | 2.5% of all sales | Each Month | Pay by day 10 of the next month |
Tech Fee | From $600 to $1,000 | Each Month | Just a guess |
Group Ad Fee | At most 4% of all sales | As set | Only if there's a local group |
How to Set Up Your Money Plan for Investing
To make a true budget for a Culver's store plan, you have to think about more than just the money for the franchise rights. You must look at the cost to build locally, the money for rent, and other costs that run the place which can add up fast.
For an idea, Culver's says each site makes about $3,694,000 a year. But, new or not-so-great sites might make less money. Your plan needs to cover all fees from the main company and costs like pay for workers, food, rent or payments for the building, power, taking care of the place, and safety cover.
You should also save some money to start - about $50,000 to $120,000 - to help pay for things in the first months as you bring in more people.
Good running of the place is a must for making money over time. The way things run will play into how much you earn. Also, you should have some extra money for things you didn't plan for, like fixing tools, local ads, or new tech. Thinking about these things also makes sure you meet Culver's money needs to own a store.
How Much Money and Loans You Need
Culver's asks for some firm money rules from future store owners. You need a net worth of $1.25 million to $2 million and easy-to-use money of at least $500,000. If you want to own the land, building, and tools, you'll need $750,000 in quick assets.
"Together, you and any potential investors will need a minimum of $500,000 in liquid assets to qualify for ownership of a Culver's franchise. If you prefer to own the real estate, building and equipment, you will need $750,000 in liquid assets." - Culver's
Culver's does not give out loans. They work with other groups like banks to help pay for things like the cost to start, wages, and tools. You must put in 20% of the full cost in cash, which might be $500,000 to $1.7 million, based on the total cost.
For vets, there's a bonus: a $10,000 cut in the first fee to join.
Day to Day Work and Staff Needs
Running a Culver's franchise means hands-on work with staff, teaching them, and handling everyday costs. It's key to know these tasks well to see if the business can make a steady profit.
Staff Needs and Job Leaving Issues
Every Culver's spot needs a team that has managers, cooks, cashiers, and food prep folks. A big issue is high staff leaving, which leads to a lot of hiring and teaching. With long hours, handling many shifts and having enough staff takes good planning and strong leading.
Teaching Needs and Owner's Role
Once staff is set, teaching is the next big part. Franchise owners go through a deep teaching program on food prep, customer help, and how things run. This mix of hands-on and class lessons makes sure they reach Culver's high bar. Yet, the need to be fully in during and after teaching might not fit those who want a less hands-on way of making money.
Mixing Money Made and Costs
Everyday work brings big costs like pay, top stuff for food, rent, utilities, fixing stuff, and paying back loans. The money to pay off the first money put in can also lower profits. These parts really shape the total money made back. For those thinking of owning a franchise, it’s key to look at the money hoped for against these costs to see if the shop fits their money goals.
Land Rules and Too Many Shops
When you think about starting a Culver's shop, where it sits matters a lot and can change how well your money does. The company's rules on land areas and how packed the market is are key in figuring out how well you might do.
Land Size and Picking a Place
Culver's lets its shop owners have a safe area, often set as 3 miles wide. In this zone, no other Culver's can start, so you don't have to fight the same brand nearby. But, in places with lots of people, this area may get smaller, and that might cut down the number of folks you can bring in.
Culver's helps its owners pick spots by offering market study and site checks. This support is key to see if a spot might work well or not.
Too Many Shops in Small Areas
In spots where Culver's has been for ages, too many shops might be a big block. For example, Wisconsin has 153 Culver's for about 38,050 people each. This thick net can make shops fight more for diners. In fact, a survey showed that up to 45% of folks in full places find it hard to pick where to eat, so owners might need to spend more on ads to get noticed.
But, newer areas look to have more room to grow. Like, in Florida and Arizona, each Culver's serves around 173,210 and 202,190 people, each. Ohio has more room, with about 417,460 people for each shop.
How to Check Your Market Before You Jump In
To deal with worries about too many shops, deep local study is a must. Start by looking at who lives there, what they eat, and how much they earn. See if a Culver's would fit what people like there.
Check out how busy roads get when most folks are out to see how easy it is for them to stop by. Look at nearby shops - if they're doing well or not - that might tell you how strong the local money scene is. Also, check all food spots within 5 miles, from burger places to other fast food.
Big changes like more people moving in should be in your study too. Is the place getting bigger, staying the same, or getting smaller? New homes, work areas, or big builds often mean a place is on the up, but fewer people could slow things down.
In some spots - like bits of Florida, Illinois, Indiana, Michigan, North Dakota, South Dakota, Texas, Wisconsin, and Wyoming - lands might say "Only for old shop owners". This often means the area is already full, making it hard for new folks to start there.
Should You Put Money in a Culver's Franchise?
Thinking about buying into a Culver's franchise? It all comes down to your money, free time, and the place you live. Let's dig into it:
Money Matters
First, check that you have enough cash. You need money to start and to keep the place up and running. And, make sure this won't mess up your other money needs.
Time Needed
Running a Culver's takes a lot of your time. It’s not something you can do on the side. If you want something easy, this may not be for you.
The Place Around You
How well you do will depend a lot on where you are. Are there a lot of eateries like this one near you? Is it too crowded? Or, maybe, if there’s less of them or new people moving in, you might do well. Go out, see places, talk to people who already own one, and watch what’s happening nearby to choose smart.
FAQs
How much money do you need to start a Culver's franchise?
Starting a Culver's franchise isn't cheap. The first cost to set it up will often range from $2.4 million to $8.6 million. This sum covers land, building work, tools, and goods.
To qualify, you will need at least $500,000 in easy-to-use cash and other money needs. It's very important to think about these costs in line with your money aims and your area's market state before you jump in.
How does where a Culver's shop is set up change how well it does and how much money it makes?
How well a Culver's shop does and how much money it makes depends a lot on where it is. Big things like being easy to see, having many people pass by, needing what they sell, and not too many places like it nearby can change how well it does. A shop seen by many in a busy spot can make more money. Yet, one on a bad spot or too many like it around can hurt how it grows and its money.
If you pick a new place with not many shops, it can make better money and grow for longer. But, picking a place hard to get to or with many shops like it can make running it hard and take money away. It's key to look well into where to put it and check if it works with what people around need, to aim to make the most out of your money.
