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L & L Hawaiian Barbecue Franchise ProfileRestaurant Franchises > Quick-Service Restaurants |
What Are the Initial Investment Requirements for an L & L Hawaiian Barbecue Franchise?
To open an L & L Hawaiian Barbecue franchise, you will need to prepare for a range of initial investment costs. The franchise fee is set at $30,000, and the total investment can vary significantly, ranging from $133,700 to $535,000. Additionally, you should have a minimum cash requirement of $10,000 and a net worth between $350,000 and $750,000. Understanding these financial commitments is crucial for aspiring franchisees to ensure they are adequately prepared to launch their business.
What Are the Financial Performance Metrics for L & L Hawaiian Barbecue Units?
L & L Hawaiian Barbecue franchises can generate impressive revenue, with average annual sales reported at approximately $478,100 per unit. The financial breakdown indicates a gross profit margin of 59.4%, which is quite favorable in the restaurant industry. However, operating expenses average around $247,000, highlighting the importance of efficient cost management to maximize profitability. With a breakeven time of just 12 months and an investment payback period of 14 months, this franchise model shows potential for quick returns on investment.
What Ongoing Fees Should Franchisees Expect?
Franchisees of L & L Hawaiian Barbecue should be prepared for ongoing fees that contribute to the brand’s marketing and operational support. A royalty fee of 3% of gross sales is required, along with a 1% marketing fee. These fees are essential for maintaining brand standards and supporting franchisee growth through collective advertising efforts. Understanding these ongoing costs is vital for financial planning and ensuring long-term success within the franchise system.
How Has L & L Hawaiian Barbecue Expanded in Recent Years?
L & L Hawaiian Barbecue has shown steady growth in its franchise network, increasing from 185 units in 2018 to 200 units by 2020. This growth indicates a growing demand for the brand and its offerings. Notably, all units within this period have been franchised, demonstrating a successful model for franchisee-driven expansion. As a potential franchisee, recognizing this trend can help you assess the brand's stability and future growth prospects in the competitive restaurant landscape.
L & L Hawaiian Barbecue Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
L & L Hawaiian Barbecue Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2018 | 2019 | 2020 |
|---|---|---|---|
| Total Units | 185 | 190 | 200 |
| Net Change YoY | 5 | 10 | |
| Franchised Units | 185 | 190 | 200 |
| Net Change YoY | 5 | 10 | |
| Corporate Units | 0 | 0 | 0 |
| Net Change YoY | 0 | 0 |
Investment Overview
The L & L Hawaiian Barbecue franchise offers a low initial investment range of $133,700 to $535,000, making it accessible for aspiring entrepreneurs. The franchise fee is set at $30,000, while ongoing costs include a royalty fee of 3% and a marketing fee of 1%. A cash reserve of $10,000 is recommended, alongside a net worth requirement between $350,000 and $750,000 to ensure potential franchisees are financially prepared.
Financial Performance
Franchisees can expect an average annual revenue of approximately $500,000, with a median revenue of $450,000 per unit. Revenue can vary significantly, with the lowest annual revenue reported at $350,000 and the highest at $750,000. This performance highlights the brand's strong market presence and the potential for profitability within the franchise model.
Breakeven and Payback
L & L Hawaiian Barbecue franchises typically achieve breakeven within 12 months of operation, which is a strong indicator of the brand's efficiency and market demand. The investment payback period averages around 14 months, providing franchisees with a clear timeline for recovering their initial investment and beginning to see returns.
Unit Growth
The franchise has shown consistent growth in the number of franchised units, increasing from 185 in 2018 to 200 in 2020. This growth trend reflects the brand's expanding footprint and popularity, indicating a robust market demand for Hawaiian barbecue cuisine across various regions.
Operational Insights
Average operating expenses for L & L Hawaiian Barbecue units are estimated at $247,000 annually, which includes costs such as rent, utilities, and staff wages. The cost of goods sold (COGS) accounts for approximately 40.6% of revenue, resulting in a gross profit margin of 59.4%. Understanding these financial metrics is crucial for franchisees to manage their operations effectively.
Training and Support
L & L Hawaiian Barbecue provides comprehensive training and ongoing support to franchisees, ensuring they are equipped to run their businesses successfully. This includes travel and living support during training, which can range from $3,700 to $7,500. The emphasis on training helps franchisees navigate operational challenges and leverage best practices for maximizing profitability.
Frequently Asked Questions
The initial investment for an L & L Hawaiian Barbecue franchise ranges from $133,700 to $535,000, which includes the $30,000 franchise fee and other startup costs.