A manager-run U.S. The Halal Guys restaurant may produce roughly a $15,000 loss to $54,000 of annual pre-tax residual owner earnings per unit in the modeled scenarios. The base scenario is about $13,000. An eligible owner who personally replaces the required General Manager may instead receive an estimated owner-operator benefit of about $48,000 to $117,000, because that figure includes the market value of the owner's management labor.
Data basis. The legal franchisor is The Halal Guys Franchise Inc., a New Jersey corporation. The Franchise Disclosure Document was issued April 30, 2026. Item 19 covers calendar-year 2025 Gross Revenue for 70 franchised restaurants open for a full 12 months and three comparable corporate restaurants; seven newer franchised restaurants and one corporate ghost kitchen were excluded. The earnings model uses the franchised-restaurant median Gross Revenue, recurring obligations in Items 6 and 15, the IRS 2023 Accommodation and Food Services partnership benchmark, and the BLS May 2024 Food Service Managers wage. Data checked July 14, 2026.
FDD citations in this article refer to The Halal Guys 2026 Franchise Disclosure Document: Items 5–7, pp. 7–25; Item 15, pp. 51–52; Item 19, pp. 61–62; and Item 20, pp. 62–67. No public copy matching the legal entity, year, and amendment status was verified on a franchise-controlled domain, so the FDD citations are intentionally unlinked.
Item 19 supplies a broad same-brand revenue cohort, but it does not disclose restaurant expenses or owner profit. The revenue anchor is strong; the conversion from revenue to earnings is not brand-specific.
The result depends materially on a broad IRS industry margin whose expense mix and owner-compensation treatment cannot be matched precisely to The Halal Guys.
Calendar 2025; 70 reporting franchised restaurants open for the full year.
90.9% of franchised restaurants existing at year-end 2025; seven newer units were excluded.
6% Royalty, 2% Worldwide Creative Marketing Fee, and 1% Local Advertising.
$250 per week per restaurant, before the one-time setup fee.
2023 Accommodation and Food Services partnerships: ordinary business income divided by business receipts.
What does The Halal Guys Item 19 actually measure?
Item 19 officially measures historic Gross Revenue, not owner earnings. For the 70 Reporting Franchised Restaurants open throughout 2025, average Gross Revenue was $1,228,086 and median Gross Revenue was $1,068,800. The highest reported restaurant generated $2,754,772 and the lowest generated $520,804; 22 restaurants, or 31.4%, met or exceeded the average.
The average is about 14.9% above the median, which indicates that higher-volume restaurants pull the mean upward. The median is therefore the cleaner central revenue anchor for a prospective single-unit buyer. It still does not indicate how much cash remains after food, payroll, rent, royalties, advertising, technology, insurance, repairs, interest, depreciation, and other operating costs.
| 2025 reporting population | Outlets | Average Gross Revenue | Median Gross Revenue | Lowest | Highest |
|---|---|---|---|---|---|
| Franchised restaurants open for the full 12 months | 70 | $1,228,086 | $1,068,800 | $520,804 | $2,754,772 |
| Corporate restaurants open for the full 12 months, excluding a ghost kitchen | 3 | $1,416,365 | $1,013,385 | $925,595 | $2,310,114 |
How is the annual earnings range calculated?
The range is estimated by applying a transparent revenue spread and margin sensitivity to the official 2025 median Gross Revenue. Because Item 19 does not publish quartiles or restaurant expenses, the conservative, base, and upside revenues are set at 80%, 100%, and 120% of the median. That spread is analytical, not FDD-reported.
The base margin is 1.22%, calculated from the IRS Statistics of Income 2023 partnership table for Accommodation and Food Services: $4.430 billion of ordinary business income divided by $362.429 billion of business receipts. The conservative and upside margins are the benchmark minus and plus three percentage points, producing −1.78%, 1.22%, and 4.22%. The IRS category includes businesses beyond limited-service franchised restaurants, so the proxy is deliberately assigned Limited confidence.
- Conservative: 80% of median revenue, or $855,040, multiplied by a −1.78% margin.
- Base: median revenue of $1,068,800 multiplied by the 1.22% IRS ordinary-business margin proxy.
- Upside: 120% of median revenue, or $1,282,561, multiplied by a 4.22% margin.
Residual earnings per restaurant before personal income taxes and financing principal payments.
Interpretation: The scenario range crosses zero because a restaurant can generate more than $1 million in Gross Revenue and still leave little or no residual profit after its complete expense structure. Sources: The Halal Guys 2026 FDD, Item 19, pp. 61–62; IRS 2023 partnership income and deduction table. Values rounded to the nearest $1,000 after calculation.
What is included in “pre-tax owner earnings” here?
This estimate is a tax-return-margin residual, not EBITDA, store-level profit, cash flow, or after-tax take-home pay. Its treatment follows the available benchmark rather than silently converting the IRS measure into a different metric.
- Operating expenses
- Reflected in the all-in IRS ordinary-business margin at the broad industry level. The Halal Guys recurring fees are not subtracted a second time because the IRS “other deductions” category may already contain franchise and advertising charges for some reporting businesses.
- Manager compensation
- A normal paid-manager cost is treated as embedded in the manager-run industry margin. The FDD requires at least one General Manager and three Assistant General Managers.
- Interest and depreciation
- Included within IRS tax-return deductions at the benchmark-population level. Their exact amount for The Halal Guys restaurants is unknown and cannot be separated from the published industry aggregate.
- Owner compensation
- Not separately disclosed by Item 19. IRS partnership data may include guaranteed payments to partners, creating possible overlap that reduces confidence in the owner-role adjustment.
- Capital spending
- Capital expenditures and remodel cash outlays are not separately modeled; only the benchmark's depreciation treatment is embedded.
- Debt and taxes
- Financing principal and personal income taxes are excluded. The FDD states that the franchisor does not finance the initial investment, and no uniform buyer financing structure is available for a responsible debt-service calculation.
How does active owner operation change the result?
An eligible owner-operator may add approximately $63,040 of labor value to each scenario by replacing the paid General Manager, but that increment is compensation for work, not passive business profit. Item 15 permits an owner to serve as General Manager only if the owner has at least three years of restaurant management or restaurant ownership experience. The restaurant must still retain three Assistant General Managers and the other personnel needed to operate the unit.
The $63,040 assumption is the BLS May 2024 median annual wage for Food Service Managers in Food Services and Drinking Places. The BLS wage excludes self-employed workers. It is used as a replacement-cost estimate, not as a guaranteed salary or a prediction of what a particular owner will draw.
The distance between the markers is the assumed $63,040 market value of General Manager labor.
Interpretation: Owner involvement changes the economic benefit mainly by replacing paid management labor. It does not automatically improve the restaurant's underlying operating margin. Sources: The Halal Guys 2026 FDD, Item 15, pp. 51–52; BLS Food Service Managers wage data. Values rounded to the nearest $1,000.
What could move actual owner earnings outside this range?
Sales volume, labor efficiency, food cost, and occupancy are the largest operating variables, while the biggest evidence gap is the absence of a same-brand restaurant profit-and-loss statement. The FDD's official franchised Gross Revenue range is unusually wide: the highest reporting restaurant produced more than five times the revenue of the lowest. A single national margin cannot capture those local economics.
Item 20 also warrants caution when interpreting a full-year reporting cohort. Franchised outlet count declined from 80 at the start of 2025 to 77 at year-end. Seven restaurants opened and ten ceased operations for “other reasons.” The FDD does not publish the sales, losses, debt burden, or closure causes of those ten restaurants. The seven new restaurants were excluded from Item 19 because they were not open for the full year.
- Obtain Item 19 substantiation. Ask for the written records supporting the 70-unit franchised cohort, including how Gross Revenue was collected and verified.
- Request unit-level P&Ls. Compare food and paper cost, hourly labor, General Manager and Assistant General Manager payroll, rent and common-area charges, insurance, repairs, utilities, delivery commissions, and all technology programs.
- Separate mature and ramping restaurants. Confirm performance by opening year, market type, square footage, drive-thru status, delivery mix, and whether a location is owner-operated or manager-run.
- Interview current and former franchisees. Test the $855,000, $1.069 million, and $1.283 million revenue assumptions and ask how much cash remained after debt payments, remodels, and owner compensation.
- Reconcile every recurring fee. Verify the 6% Royalty, 2% Worldwide Creative Marketing Fee, 1% Local Advertising requirement, $250 weekly Technology Operations Fee, loyalty, online ordering, digital menu, gift card, inspection, and supplier charges.
- Model financing separately. Use the buyer's actual loan amount, interest rate, amortization, landlord contribution, and equipment financing rather than subtracting the Item 7 startup investment from one year of sales.
What is the strongest defensible earnings takeaway?
The strongest defensible manager-run range is approximately −$15,000 to $54,000 in annual pre-tax residual owner earnings per restaurant, with a $13,000 base scenario; an eligible working owner may receive approximately $48,000 to $117,000 of owner-operator benefit. These are scenario-based estimates, not official The Halal Guys earnings results.
The most important driver is the interaction between restaurant-level sales and the all-in operating margin: a few percentage points of margin on roughly $1.1 million of revenue changes annual residual earnings materially. The largest unresolved uncertainty is the same-brand cost structure, especially food, management payroll, occupancy, delivery expense, and the treatment of owner compensation. Before relying on the range, a buyer should verify Item 19 substantiation, request comparable restaurant P&Ls, and interview both current and former franchisees about residual cash after recurring fees, financing, and required reinvestment.