What Are Operating Procedures of Burgerim Franchise
Curious about how the Burgerim franchise model operates and what it takes to become a franchisee? Understanding the operational framework and financial commitments is crucial for any aspiring owner. Dive into the details of this popular fast-casual concept and discover if it aligns with your entrepreneurial goals, and explore our comprehensive Burgerim Franchise Business Plan Template to guide your strategic planning.
| # | Operating Procedure | Description |
|---|---|---|
| 1 | Menu Execution | Strict adherence to standardized recipes and preparation methods for all menu items ensures product consistency. This involves precise portioning and cooking times to maintain quality and manage food costs effectively. |
| 2 | Inventory Management | Implementing a robust system for tracking and managing inventory is crucial to minimize waste and ensure the availability of ingredients. This includes regular stock counts and adherence to first-in, first-out (FIFO) principles. |
| 3 | Customer Service Standards | Maintaining high levels of customer service through friendly and efficient interactions is a core operational focus. This includes prompt order taking, accurate order fulfillment, and addressing customer inquiries or concerns professionally. |
| 4 | Health and Safety Compliance | Ensuring all units operate in strict compliance with local health codes and food safety regulations is paramount. This involves regular cleaning schedules, proper food storage, and staff training on hygiene practices. |
| 5 | Point of Sale (POS) System Usage | Effective utilization of the POS system for order processing, payment handling, and sales tracking is essential for operational efficiency. This system also provides valuable data for sales analysis and inventory control. |
The financial structure of a Burgerim franchise involves an initial investment ranging from $40,000 to $683,000, with a franchise fee of $70,000. Ongoing fees include a 5% royalty fee and a 1% marketing fee on gross sales. Franchisees are required to have $30,000 - $70,000 in cash on hand and a net worth of $200,000 - $500,000.
Revenue projections from the Franchise Disclosure Document (FDD) show significant variability, with average annual revenue per unit at $180,000, median at $500,000, and the highest at $1,000,000, while the lowest reported is $70,000. The FDD indicates a breakeven and investment payback time of approximately 12 months.
The growth trajectory of franchised units shows a rapid increase from 0 in 2016 to 22 in 2017, and then to 86 by 2018. Notably, there were no company-owned units reported during this period (2016-2018), indicating a business model heavily reliant on franchising. The total number of units grew from 0 in 2016 to 108 by 2018.
| Financial Metric | Amount ($) | Percentage of Revenue (%) |
|---|---|---|
| Average annual revenue | 800,000 | 100% |
| Cost of goods sold (COGS) | 320,000 | 40% |
| Gross Profit Margin | 480,000 | 60% |
| Operating Expenses | 384,000 | 48% |
| EBITDA | 96,000 | 12% |
| Expense Type | Annual Amount ($) |
|---|---|
| Lease Payments | 19,200 - 108,000 |
| Insurance | 2,400 - 8,000 |
| Advertising | 2,500 - 10,000 |
| Professional Fees | 500 - 8,000 |
| Management and Administrative Salaries | 40,000 - 80,000 |
| Utilities | 3,600 - 12,000 |
| Miscellaneous Operational Costs | 5,000 - 15,000 |
| Total | 73,800 - 341,000 |
Key Takeaways
- The Burgerim franchise model was built around a gourmet mini-burger concept with extensive customization, aiming for high-volume sales and increased average ticket prices.
- Operationally, the model demanded complex inventory management, leading to significant food waste and higher-than-projected costs, exacerbated by a lack of corporate support after the franchisor's collapse.
- The Burgerim franchisor, Burgerim Group USA, filed for Chapter 11 bankruptcy in 2021, and its founder faced an FTC lawsuit for misleading franchisees, resulting in a $49 million judgment.
- The vast majority of Burgerim franchisees lost their entire investment, with losses ranging from $200,000 to $700,000 per individual, and fewer than 10 locations are estimated to still operate under the original brand as of early 2025.
- Initial investments for a Burgerim franchise were estimated between $193,650 and $683,000, with franchise fees advertised as $15,000-$50,000 but often misrepresented.
- Red flags in Burgerim's 2019 FDD included a disparity between projected and actual store openings, unfavorable clauses favoring the franchisor, and a lack of robust financial performance data.
- Historical financial requirements for prospective Burgerim franchisees included a minimum liquidity of $100,000 and a net worth of $250,000, though these were not always strictly enforced, contributing to the system's instability.
What Is The Business Model Structure?
What was the Burgerim franchise model?
The historical Burgerim franchise model was built around a unique 'gourmet mini-burger' concept. This approach offered customers the ability to customize their meals with 28-ounce patties, available in single, duo, trio, or even 16-count party packs. This was a distinctive offering in the fast-casual dining landscape before the brand's eventual challenges.
What defined the core concept?
The core concept of the Burgerim franchise was to drive high sales volume by encouraging customers to explore a wide array of flavor combinations. With over 10 different patty options, a variety of buns, sauces, and toppings, this strategy was designed to increase the average ticket price significantly compared to traditional single-burger establishments.
The Burgerim business opportunity was presented as a turnkey solution, requiring a smaller footprint of 1,000-2,000 square feet compared to larger competitors. This promised lower initial build-out costs and a simpler operational structure, which was particularly appealing to many first-time entrepreneurs looking for a straightforward entry into the franchise world.
How did its operational model function?
The operational model of the Burgerim franchise necessitated franchisees managing a complex inventory featuring dozens of SKUs to support the extensive customization options. This often resulted in considerable food waste, with waste reports from former franchisees in the 2019-2020 period occasionally exceeding 15% of food costs, leading to higher-than-projected expenses.
Crucially, the model depended heavily on corporate support for supply chain management and marketing efforts. Unfortunately, this support became virtually non-existent following the franchisor's collapse, leaving franchisees without essential guidance or negotiated supplier pricing, impacting their ability to operate efficiently.
As of 2025, the original operational model is no longer functional. Any remaining locations have transitioned to operating as independent restaurants, having moved away from the defunct franchise system and its prescribed procedures.
Key Considerations for Franchise Operations
- Inventory Management: The extensive menu options, while a customer draw, required meticulous inventory control to minimize waste.
- Supplier Reliance: A strong, consistent supply chain and favorable vendor pricing are critical for profitability.
- Adaptability: The ability to adapt to changing market demands and operational challenges is a vital success factor.
For those considering entering the franchise system, understanding the intricacies of the operational model is paramount. You can learn more about the potential challenges and rewards by exploring What Are the Pros and Cons of Owning a Burgerim Franchise?
Is Burgerim A Good Franchise To Own?
What is the brand's current status?
Is the franchisor still operating?
As of 2025, the Burgerim franchisor is no longer operational. The company, Burgerim Group USA, filed for Chapter 11 bankruptcy in 2021. Furthermore, its founder faced a Federal Trade Commission (FTC) lawsuit alleging deceptive practices toward potential franchisees. The FTC charged the company and its founder with violating the FTC Act and the Franchise Rule. In 2022, a judgment of $49 million was secured, addressing the harm caused to over 1,500 individuals who had invested in a Burgerim franchise. Consequently, there are no legitimate Burgerim franchises currently being offered by a corporate entity. Any listings found are likely unauthorized or pertain to the resale of defunct, independent restaurant assets.
What happened to existing franchisees?
The vast majority of individuals who invested in the Burgerim franchise opportunity lost their entire investment. Between 2021 and 2022, reports indicated that over 1,500 franchise agreements were sold. However, fewer than 200 stores ever opened, and most of these have since ceased operations. Many former franchisees are now saddled with substantial debt from Small Business Administration (SBA) loans and personal financing. Average reported losses per franchisee ranged between $200,000 and $700,000. As of early 2025, it's estimated that fewer than 10 active Burgerim franchise locations remain operating under the original brand. Many of these have likely de-branded to operate as independent eateries.
How Does the Burgerim Franchise Work?
The Burgerim franchise model was designed around a fast-casual burger restaurant concept. Franchisees were expected to invest in a restaurant location, undergo training, and operate according to the franchisor's established systems. The initial Burgerim franchise cost could vary significantly, with the FDD data showing a low initial investment of $40,000 and a high initial investment reaching up to $683,000. This wide range likely accounted for factors like location, size, and build-out requirements. The franchise fee alone was $70,000, with ongoing fees including a 5% royalty fee and a 1% marketing fee. The required cash on hand was between $30,000 and $70,000, with a net worth requirement of $200,000 to $500,000.
The operational model involved serving customizable burgers with various patties, buns, and toppings. According to the FDD data, the average annual revenue per unit was reported as $180,000, with a median of $500,000. However, the lowest reported annual revenue was $70,000, while the highest reached $1,000,000. The FDD also projected a breakeven time of 12 months and an investment payback of 12 months, figures that, in retrospect, did not materialize for most franchisees.
For those interested in understanding the process of establishing such a business, resources like How to Start a Burgerim Franchise in 7 Steps: Checklist provided a guide to the steps involved. However, given the current status of the franchisor and the widespread financial losses experienced by early investors, pursuing this particular franchise opportunity is not advisable.
Key Considerations for Evaluating Any Franchise Opportunity
- Due Diligence is Paramount: Always thoroughly review the Franchise Disclosure Document (FDD). Pay close attention to Item 19 (Financial Performance Representations) and Item 20 (List of Franchisees).
- Consult Professionals: Before signing any franchise agreement, have it reviewed by a franchise attorney and discuss the financial implications with an accountant.
- Talk to Existing Franchisees: Gain firsthand insights into the operational realities, support from the franchisor, and actual profitability.
The Burgerim business opportunity, at its peak, presented a franchise for sale with the promise of a specific Burgerim franchise model. The Burgerim franchise investment breakdown suggested a potentially profitable venture, but the reality for many who explored how to open a Burgerim franchise or met the Burgerim franchise requirements was starkly different. The Burgerim franchise training program and operational model, as presented, did not translate into the success factors needed for sustained business growth. Ultimately, the Burgerim franchise profit potential was not realized for the majority of its franchisees.
What Was The Burgerim Franchise Cost?
Understanding the financial commitment is a crucial first step for anyone considering a franchise. The Burgerim franchise model, like many in the fast-casual sector, involved a significant upfront investment.
What was the initial investment?
The initial investment for a Burgerim franchise could vary considerably. According to the company's Franchise Disclosure Document (FDD) from 2019, the estimated total startup costs ranged from $193,650 to $683,000. However, it's important to note that many franchisees reported their actual expenses exceeding the higher end of this spectrum.
How were franchise fees structured?
The Burgerim franchise fees, as outlined in their FDD, typically included an initial franchise fee that was advertised as being between $15,000 and $50,000. The FTC later alleged that these figures were often misrepresented. Aggressive promotions by the franchisor, including advertisements for a '$0 down' special, misled potential franchisees about the total capital required upfront. This discrepancy was a key factor in the FTC's 2020 lawsuit. Beyond the initial fee, the Burgerim franchise agreement details mandated a 5% royalty on gross sales and a 2% marketing fee. However, the value provided by these fees was minimal, especially as the corporate structure began to falter.
What were the total startup costs?
Breaking down the total startup costs for a Burgerim franchise, a typical investment included an initial franchise fee of approximately $50,000. Leasehold improvements were estimated to cost between $80,000 and $250,000, while equipment, furniture, and fixtures were projected to be in the range of $65,000 to $120,000. These figures did not account for the substantial personal and Small Business Administration (SBA) loan debt that many franchisees accumulated. Consequently, total liabilities often surpassed $750,000 before the business even began generating revenue.
For those looking to understand the potential earnings, it's helpful to explore How Much Does a Burgerim Franchise Owner Make?
Key Financial Considerations for a Burgerim Franchise
- Initial Franchise Fee: Ranged from $15,000 to $50,000, with alleged misrepresentations by the franchisor. The FDD later listed this as up to $70,000.
- Total Startup Costs: Estimated between $193,650 and $683,000, with many franchisees experiencing costs above this range.
- Royalty Fees: A consistent 5% of gross sales was required.
- Marketing Fees: Initially set at 2%, later adjusted to 1% according to some FDD data, with questionable value provided.
- Cash Requirement: Typically between $30,000 and $70,000 was needed.
- Net Worth Requirement: Franchisees were expected to have a net worth of $200,000 to $500,000.
Operating Procedure To Analyze The Burgerim Business Opportunity
How to assess historical viability?
When evaluating any franchise opportunity, especially one with a complex past like the Burgerim franchise, a deep dive into its historical viability is paramount. For Burgerim, this means scrutinizing its financial and legal records. A key document to review is the 2021 Chapter 11 bankruptcy filing of Burgerim Group USA in the US Bankruptcy Court for the Central District of California, identified under Case No 2:21-bk-10497. This filing provides critical insights into the company's financial distress.
Furthermore, understanding the regulatory actions taken against the brand is essential. The Federal Trade Commission's (FTC) 2020 complaint and the subsequent 2022 stipulated order for a permanent injunction and monetary judgment are vital. These documents detail the deceptive practices that were allegedly employed to sell franchises, offering a stark warning about the business opportunity.
To gain a comprehensive understanding of the operational challenges, it’s also beneficial to research news archives and franchisee forums covering the period from 2019 to 2022. These sources often reveal widespread franchisee complaints regarding a lack of support, supply chain failures, and misleading sales tactics. These are precisely the factors that contribute to a franchise's success, and their absence in Burgerim's history is a significant red flag.
The Burgerim franchise cost and the overall investment required for a Burgerim franchise for sale should be weighed against these historical performance indicators. The Burgerim franchise model, as it operated, appears to have lacked the fundamental support structures necessary for franchisee success.
How to verify brand reputation?
Verifying the brand reputation of any franchise is a critical step before committing capital. For the Burgerim franchise, a straightforward online search for terms like 'Burgerim lawsuit' or 'Burgerim FTC' as of 2025 will yield extensive documentation confirming the brand's significant downturn and the legal actions that were pursued. This readily available information paints a clear picture of its lack of viability as a current investment.
The Burgerim franchise profit potential, as perceived by many early investors, proved to be largely illusory. Court documents and various media reports consistently cite that the vast majority of franchisees were unable to recoup their initial investment, let alone achieve profitability. This lack of financial success is a critical data point for any prospective franchisee considering the Burgerim investment.
For further validation, contacting state attorneys general offices in regions where Burgerim had a significant presence can provide access to records of consumer and franchisee complaints filed between 2018 and 2022. These official complaints offer direct evidence of the issues faced by those who engaged with the Burgerim franchise opportunity.
For those exploring the franchise landscape, understanding these past issues is crucial. While the Burgerim franchise requirements and the Burgerim franchise fees explained might seem standard, the historical operational model and the ultimate collapse of the business indicate significant risks. Prospective franchisees should always conduct thorough due diligence, including reviewing the Franchise Disclosure Document (FDD) and speaking with existing or former franchisees. For those interested in exploring other options, What Are Some Alternatives to the Burgerim Franchise? offers valuable insights into different industry sectors.
Key Due Diligence Steps for Assessing Franchise Viability
- Review Bankruptcy Filings: Examine Chapter 11 filings to understand financial distress.
- Investigate Regulatory Actions: Look into FTC complaints and judgments detailing deceptive practices.
- Consult News Archives and Forums: Gather insights from franchisee experiences and media reports on operational issues.
- Verify Profitability Claims: Cross-reference stated profit potential with actual franchisee outcomes.
- Contact State Agencies: Obtain records of official consumer and franchisee complaints.
| Burgerim Franchise Cost Range | $40,000 - $683,000 |
| Initial Franchise Fee | $70,000 |
| Royalty Fee | 5% |
| Marketing Fee | 1% |
| Cash Required | $30,000 - $70,000 |
| Net Worth Requirement | $200,000 - $500,000 |
| Financial Metric | Average Amount ($) | Percentage of Revenue (%) |
|---|---|---|
| Average Annual Revenue per Unit | $180,000 | N/A |
| Median Annual Revenue per Unit | $500,000 | N/A |
| Lowest Annual Revenue per Unit | $70,000 | N/A |
| Highest Annual Revenue per Unit | $1,000,000 | N/A |
| Average Annual Revenue (from P&L) | $800,000 | 100% |
| Cost of Goods Sold (COGS) | $320,000 | 40% |
| Gross Profit Margin | $480,000 | 60% |
| Operating Expenses | $384,000 | 48% |
| EBITDA | $96,000 | 12% |
Operating Procedure To Review The Burgerim Franchise Agreement
How to identify red flags in the FDD?
When evaluating any franchise opportunity, particularly one like the Burgerim franchise, a thorough review of the Franchise Disclosure Document (FDD) is paramount. A deep dive into Burgerim’s last available FDD from 2019 uncovered several critical red flags that would have alerted cautious investors. One significant concern was the stark disparity between the projected number of new openings and the actual number of operating stores listed in Item 20 of the document. This mismatch often indicates a struggle for the franchisor to maintain a healthy network of franchisees or a lack of sustained growth, which was indeed a harbinger of future issues.
Furthermore, the Burgerim franchise agreement details contained within the FDD showed clauses that disproportionately favored the franchisor. These agreements offered minimal protection or recourse for franchisees in the event of corporate difficulties. This one-sided structure represented a substantial risk, a risk that was ultimately realized by many who invested in the Burgerim business opportunity.
Prospective franchisees should always scrutinize the financial performance representations, or the lack thereof, in Item 19 of the FDD. For Burgerim, the absence of robust, verifiable data on franchisee earnings was a major warning sign. Reliable financial performance data is a cornerstone for any informed investment decision, and its omission suggests a potential lack of transparency or an inability to demonstrate consistent profitability across the franchise system.
How to understand contractual obligations?
The historical Burgerim franchise agreement placed significant ongoing financial obligations on franchisees. These included paying royalties and marketing fees, which collectively amounted to 7% of gross sales. This commitment was made with the expectation of receiving a functioning support system from the franchisor. However, by 2020, this support system had effectively ceased to exist, leaving franchisees obligated to make payments for a service that was no longer being provided, a clear example of financial entrapment.
The contract also stipulated adherence to specific suppliers and branding guidelines. When the corporate supply chain collapsed, franchisees found it impossible to comply with these mandates. This situation technically placed them in breach of their own agreements, creating a precarious legal and operational position. Understanding these past contractual obligations is crucial for answering the question: Is Burgerim a good franchise to own? The answer is a resounding no, as the contractual framework itself was a primary instrument in the financial downfall of many franchisees.
The franchise agreement details are the backbone of the franchisor-franchisee relationship. Failing to dissect these clauses can lead to unforeseen liabilities. For instance, understanding the termination clauses and the franchisor's rights versus the franchisee's rights is vital. In the case of Burgerim, the terms were heavily weighted, leaving franchisees vulnerable.
When considering a franchise for sale Burgerim, it's essential to look beyond the initial Burgerim franchise cost. The ongoing fees and the franchisor's ability to deliver on its promises are far more critical to long-term success. The Burgerim franchise model, as it unfolded, demonstrated a severe disconnect between the promised support and the actual delivery.
| Key Contractual Aspects | Franchisee Obligation | Potential Risk Identified |
| Royalty & Marketing Fees | 7% of gross sales | Payment for non-existent support system |
| Supplier & Branding Mandates | Adherence to specific suppliers and branding | Breach of contract due to supply chain collapse |
| Franchisor Recourse | Limited franchisee protection | Vulnerability in case of franchisor failure |
Tips for Reviewing Franchise Agreements
- Consult Legal Counsel: Always have a franchise attorney review the agreement before signing. They can identify unfavorable clauses and negotiate terms.
- Scrutinize Item 19: Pay close attention to the Financial Performance Representations. Lack of verifiable data is a major red flag.
- Understand Termination Clauses: Know the conditions under which either party can terminate the agreement and the associated penalties.
- Analyze Support Obligations: Clarify what support the franchisor is contractually obligated to provide and how it will be delivered.
The Burgerim franchise investment breakdown, including the initial Burgerim franchise cost ranging from $40,000 to $683,000, with a franchise fee of $70,000, needs to be viewed through the lens of the contractual obligations. The Burgerim franchise training program and operational model are only as good as the support that backs them. Without that support, even the best training cannot guarantee success.
For those exploring how to open a Burgerim franchise or similar ventures, understanding the nuances of the franchise agreement details is as critical as the initial Burgerim investment. The Burgerim franchise model ultimately failed many due to these contractual and operational breakdowns. Therefore, assessing the Burgerim franchise profit potential requires a deep understanding of these foundational elements.
Operating Procedure To Investigate Burgerim Franchise Requirements
What were the financial requirements?
When considering a Burgerim franchise, understanding the financial landscape is paramount. Historically, the stated financial requirements included a minimum liquidity of $100,000 and a net worth of at least $250,000. However, it's important to note that the FTC found these benchmarks were not consistently enforced. The franchisor actively marketed the Burgerim business opportunity, often targeting individuals with access to SBA loans and retirement funds. This approach sometimes involved less rigorous verification of business acumen or the capacity to manage substantial debt loads. This lenient financial vetting was a significant aspect of the growth strategy, prioritizing unit sales over the long-term financial health of franchisees.
From the Franchise Disclosure Document (FDD), the initial investment for a Burgerim franchise could range widely, from a low of $40,000 to a high of $683,000. The initial franchise fee alone was $70,000. Ongoing fees included a royalty fee of 5% and a marketing fee of 1%. The required cash on hand was typically between $30,000 and $70,000, with a required net worth ranging from $200,000 to $500,000.
| Financial Aspect | Typical Range |
| Minimum Liquidity (Historical) | $100,000 |
| Minimum Net Worth (Historical) | $250,000 |
| Low Initial Investment | $40,000 |
| High Initial Investment | $683,000 |
| Franchise Fee | $70,000 |
| Royalty Fee | 5% |
| Marketing Fee | 1% |
| Cash Required | $30,000 - $70,000 |
| Net Worth Required | $200,000 - $500,000 |
What were the operational requirements?
The operational side of the Burgerim franchise model presented its own set of challenges. While the Burgerim franchise training program was advertised as a comprehensive multi-week course, many former franchisees reported it was significantly shorter, sometimes only lasting a few days, and offered limited practical value. The Burgerim franchise operational model typically required owner-operators to be actively involved on-site. However, a critical deficiency was the lack of robust corporate support in crucial areas such as local marketing initiatives, inventory management, and human resources. This left many franchisees feeling isolated and struggling to manage day-to-day operations effectively.
A significant operational requirement was adherence to brand standards. However, the franchisor itself often failed to consistently uphold these standards, contributing to a disorganized environment. Consequently, franchisees were frequently left to develop their own operational strategies and solutions simply to stay afloat and survive in a competitive market. The Burgerim franchise agreement details would outline these standards, but the practical application was often inconsistent.
Operational Focus Points for Franchise Investigation
- Training Program Effectiveness: Investigate the actual duration and content of the training provided. Does it align with the advertised program?
- Corporate Support Structure: Understand the depth and breadth of support offered in areas like marketing, supply chain, and HR. What resources are readily available?
- Brand Standard Consistency: Assess how well the franchisor enforces its own brand standards and how this impacts unit operations.
- Owner-Operator Involvement: Clarify the expected level of daily involvement and whether it is feasible given the support structure.
Looking at the FDD data, the average annual revenue per unit was reported at $180,000, with a median of $500,000. The lowest annual revenue was $70,000, while the highest reached $1,000,000. The FDD also indicated a breakeven time of approximately 12 months and an investment payback period of also around 12 months. Unit growth showed a rapid increase from 22 franchised units in 2017 to 86 by 2018, with no corporate units reported during these years.
The average P&L table from the FDD suggests that with an average annual revenue of $800,000, the cost of goods sold (COGS) was 40%, leading to a gross profit margin of 60%. Operating expenses accounted for 48% of revenue, resulting in an EBITDA of 12%. Understanding these figures is crucial when evaluating the Burgerim franchise profit potential. For those considering alternatives, understanding the nuances of different models is important. What Are Some Alternatives to the Burgerim Franchise?
| Financial Metric | Amount ($) | Percentage of Revenue (%) |
|---|---|---|
| Average Annual Revenue | 800,000 | 100% |
| COGS | 320,000 | 40% |
| Gross Profit Margin | 480,000 | 60% |
| Operating Expenses | 384,000 | 48% |
| EBITDA | 96,000 | 12% |
Operating Procedure To Create A Burgerim Franchise Business Plan
How to forecast revenue historically?
When constructing a historical revenue forecast for a Burgerim franchise business plan, it's crucial to acknowledge the findings of the FTC investigation. Any revenue projections provided by the franchisor were often inflated and lacked substantiation. Instead, a realistic approach involves analyzing data from the few locations that operated for over a year between 2018 and 2020. These stores consistently showed revenues significantly below the break-even point required to cover debt service and high operational costs. The alleged Burgerim franchise profit potential was a central element in their marketing; therefore, any post-mortem business plan should realistically project a high probability of net loss for the first 3-5 years, ultimately leading to insolvency.
How to project historical costs?
To project historical costs accurately for a Burgerim franchise business plan, one must refer to the upper range of the investment breakdown detailed in the 2019 FDD, which was between $600,000 and $700,000. This figure often proved more realistic for many franchisees. Your business plan must also account for historically high food costs, frequently falling between 35% and 40% of revenue due to waste generated by the complex menu. Additionally, factor in the 7% royalty and marketing fees, which were paid for services and support that were often non-existent. A comprehensive plan should also include a contingency fund of at least 25% of the initial investment to cover unforeseen expenses, a buffer that most franchisees lacked, contributing to their rapid failure.
Understanding the financial realities is key to evaluating any franchise opportunity. For instance, the FDD data indicates a wide range for initial investment, from a low of $40,000 to a high of $683,000. The initial franchise fee alone was $70,000, with royalty fees at 5% and marketing fees at 1%. The FDD also noted required cash reserves between $30,000 - $70,000 and a net worth requirement of $200,000 - $500,000.
When considering the Burgerim franchise cost, it's vital to look at the average P&L data. While average annual revenue was projected at $800,000 with a 60% gross profit margin, the operating expenses were estimated at 48%, leaving an EBITDA of 12%. However, the average running expenses table reveals significant variability. Lease payments could range from $19,200 to $108,000 annually, insurance from $2,400 to $8,000, and management salaries from $40,000 to $80,000. This variability underscores the importance of detailed, location-specific cost projections in any business plan.
Key Considerations for a Realistic Business Plan
- Acknowledge FTC findings regarding inflated revenue projections.
- Analyze actual performance data from existing locations, not franchisor promises.
- Budget for higher-than-expected food costs, potentially 35-40% of revenue.
- Factor in all franchise fees (royalty, marketing) even if support is lacking.
- Include a substantial contingency fund (at least 25% of initial investment) for unexpected expenses.
- Be prepared for a longer breakeven period than initially advertised; historical data suggests this was often 12 months or more.
The Burgerim franchise model, as presented, often failed to deliver on its profit potential. When crafting your business plan, it's essential to consult resources that offer a balanced perspective on franchise ownership, such as understanding What Are the Pros and Cons of Owning a Burgerim Franchise? This will help you build a plan grounded in reality, not just optimistic projections.
| Initial Investment Range | $40,000 - $683,000 |
| Franchise Fee | $70,000 |
| Royalty Fee | 5% |
| Marketing Fee | 1% |
| COGS Percentage | 40% |
| EBITDA Margin (Projected) | 12% |
| Estimated Annual Revenue (Average) | $800,000 |
Operating Procedure To Find Burgerim Franchise Locations
How to identify currently operating stores?
Identifying former Burgerim franchise locations as of 2025 requires a keen eye for de-branded establishments that might still operate with a similar menu. You might find these under new names, such as 'Burgerimio' or 'The Burger Spot.'
When using online directories like Yelp or Google Maps, you may still see listings for 'Burgerim.' However, a crucial step is to cross-check these with recent customer reviews or to make a direct phone call. This will confirm if the location is permanently closed or if it's now operating as an independent entity.
It's important to note that as of early 2025, the number of restaurants in the USA still using the Burgerim name and branding is estimated to be fewer than 10. This is a significant drop from its peak, when it was over 200 locations, a stark indicator of the system's near-total collapse.
How to understand the brand's footprint collapse?
The process of how to open a Burgerim franchise has been effectively defunct since the company's bankruptcy in 2021. Consequently, no new locations have been legitimately opened in recent years, and the prevailing trend has been mass closures.
To illustrate the scale of this decline, comparing a list of 'coming soon' locations from 2019 with a map of stores that actually opened reveals a failure rate exceeding 85% even before any customers were served. This statistic, highlighted in the FTC's case, is a critical insight into the brand's operational challenges.
The scattered nature of the few remaining independent stores serves as a clear demonstration of the complete disintegration of the national brand presence and the support network that is fundamental to any viable franchise system. This lack of a cohesive network is a significant factor in understanding the brand's current state.
Tips for Researching Franchise Locations
- Verify Current Operations: Always call a location or check recent reviews to confirm it's still operational and under the expected brand.
- Check De-Branding: Look for former locations that may have rebranded but retained similar menu items.
- Understand the History: Research the franchise's past performance and closure rates to gauge current viability.
| Year | Total Units | Franchised Units |
|---|---|---|
| 2016 | 0 | 0 |
| 2017 | 22 | 22 |
| 2018 | 108 | 86 |
The decline in franchised units is a critical factor for anyone considering the Burgerim franchise business opportunity. The initial Burgerim franchise cost could range from $40,000 to $683,000, with a franchise fee of $70,000. The required cash investment was between $30,000 and $70,000, with a net worth requirement of $200,000 to $500,000. For those interested in understanding potential earnings, exploring How Much Does a Burgerim Franchise Owner Make? can provide further context on past performance metrics.