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How Much Does it Cost to Open a Dairy Queen Franchise?

Dairy Queen

There are numerous reasons that people might be interested in starting up a Dairy Queen franchise rather than striking out on their own. For example, a franchisee can use the franchisor's brand to promote their business, thus sparing them from the expensive and time-consuming process of building up their own brand. Likewise, a franchisee can receive a wide range of support from the franchisor, which can make the start-up process much smoother than otherwise possible. Given said reasons, it is no wonder that people are interested in starting up their own Dairy Queen franchise, though they need to remember that a franchise comes with its costs as well.

What Does It Cost to Start Up a Dairy Queen Franchise?

Interested individuals should know that Dairy Queen is one of the better-known franchises that can be found out there. As a result, there are a lot of people who are interested in starting up a Dairy Queen franchise, which in turn, means that it can be much pickier than its lesser-known counterparts. Due to this, interested individuals should be prepared to pay a great deal of money because a Dairy Queen franchise will not be cheap.

For starters, interested individuals need to have at least $750,000 in net worth. Moreover, they need to have at least $400,000 in liquid capital. As for the franchise fee, interested individuals need to pay $35,000 for a Dairy Queen Grill & Chill, though there is an option of $25,000 for an Orange Julius as well. Of course, franchisees are expected to pay royalties, which are 5 percent of gross receipts for a Dairy Queen Grill & Chill and 4 percent of gross receipts for an Orange Julius. In both cases, the royalties are paid per month.

Of course, that is just the start when it comes the costs of starting up a business. After all, if someone wants to run a restaurant, they are going to need a lot of physical assets, which will range from tools and supplies to equipment and other machines. Moreover, they are going to need a building in which to house their operations, which won't come cheap to say the least. On top of this, there will be costs for finding the right people to staff a restaurant, getting the right people trained up for their new tasks, and a wide range of other necessities for a start-up. People who want their own Dairy Queen franchise have a huge step-up in this regard because they can get a much clearer picture of what they need to succeed by consulting the franchisor, but at the end of the day, they are still going to need to pay for those things.

Naturally, there are parties out there that have produced various estimates that might interest people looking into a Dairy Queen franchise. However, interested individuals need to remember that said estimates might not reflect their particular situation, seeing as how there can be a lot of variation out there. Still, estimates can be very useful for them to get a general idea of what to expect.

For instance, one estimate suggests that a building with 2,048 square feet capable of seating around 48 individuals at a time will cost somewhere between $900,000 and $1,200,000. Likewise, a building with 2,709 square feet capable of seating around 78 individuals at a time will cost somewhere between $1,080,000 and $1,370,000. This is without considering the various issues that can come up when starting up a business, which is why it is recommended that would-be business owners have more than the bare minimum. Simply speaking, the bigger their war chest, the better their chances of soaking up errors that could cause their operations to crash.

Due to this, people who are looking into a Dairy Queen franchise should consult more resources than just Dairy Queen. Yes, the franchisor can provide them with a lot of useful support, which will increase their chances of success. However, they will still be starting up a new business, which is never a simple and straightforward task even under the best of circumstances. As a result, the more preparation that they put into their ambition, the better their chances of pulling it off, which is critical because the failure rates for new businesses are very high. Still, should they succeed, the rewards can be just as great even if they have to pay royalties to their franchisor.

Garrett Parker

Written by Garrett Parker

Garrett by trade is a personal finance freelance writer and journalist. With over 10 years experience he's covered businesses, CEOs, and investments. However he does like to take on other topics involving some of his personal interests like automobiles, future technologies, and anything else that could change the world.

Read more posts by Garrett Parker

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