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Super 8 Franchise ProfileRestaurant Franchises > Full-Service Restaurants |
What Are the Initial Costs to Open a Super 8 Franchise?
To open a Super 8 franchise, you should be prepared for a range of initial costs. The franchise fee is set at $28,000, while the total initial investment can vary significantly, ranging from $231,769 to $4,667,834. This investment includes costs for real estate, construction, equipment, and other startup expenses. Additionally, you will need to demonstrate a net worth of between $500,000 and $1,000,000, ensuring you have the financial capacity to support your business in its early stages.
What Are the Ongoing Fees for a Super 8 Franchise?
As a Super 8 franchisee, you will incur ongoing fees that are essential for maintaining brand standards and marketing efforts. The royalty fee for operating a new unit is 5.5% of your gross revenue, which contributes to the overall support from the franchisor. Additionally, a marketing fee of 3% is required to fund national advertising campaigns that promote the Super 8 brand and attract customers. These fees are crucial for sustaining the brand's visibility and operational support.
What Is the Average Revenue Potential for a Super 8 Franchise?
The revenue potential for a Super 8 franchise can be quite promising. On average, each unit generates annual revenue of approximately $486,042, with a median annual revenue of $1,200,000. The highest-performing units can achieve revenues as high as $1,962,033, showcasing the potential for significant earnings. Understanding these figures can help you assess the viability of your investment and set realistic financial goals.
How Long Does It Take to Break Even with a Super 8 Franchise?
Franchisees can expect a breakeven period of around 24 months, which is relatively standard in the hospitality industry. This timeframe indicates that, with effective management and marketing strategies, you could recover your initial investment within two years of operation. Furthermore, the investment payback period aligns with the breakeven time, emphasizing the importance of maintaining operational efficiency and customer satisfaction during the early stages of your franchise.
Super 8 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:
Super 8 Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2016 | 2017 | 2018 |
|---|---|---|---|
| Total Units | 1651 | 1625 | 1608 |
| Net Change YoY | -26 | -17 | |
| Franchised Units | 1651 | 1625 | 1608 |
| Net Change YoY | -26 | -17 | |
| Corporate Units | 0 | 0 | 0 |
| Net Change YoY | 0 | 0 |
Investment Overview
The Super 8 franchise offers a range of initial investment options, with costs ranging from $231,769 to $4,667,834. The initial franchise fee is set at $28,000, and franchisees are required to pay a royalty fee of 5.5% of gross sales, along with a marketing fee of 3%. Potential franchisees should also have a net worth between $500,000 and $1,000,000 to qualify for ownership.
Revenue Potential
Super 8 units generate significant revenue, with an average annual revenue of $486,042 and a median annual revenue of $1,200,000. The revenue can vary widely, with the lowest reported annual revenue at $154,109 and the highest reaching $1,962,033. This diverse revenue potential makes Super 8 an attractive option for investors looking to enter the hospitality market.
Breakeven and Payback
Franchisees can expect to reach breakeven within approximately 24 months of operation. This aligns with the investment payback period, which also stands at around 24 months. Such rapid return on investment can be appealing for entrepreneurs seeking quick profitability in the hospitality sector.
Franchise Growth
The Super 8 brand has demonstrated consistent growth in its franchised units, with 1,651 units in 2016, 1,625 in 2017, and 1,608 in 2018. This stability indicates a strong market presence and the potential for continued expansion, making it a reliable choice for prospective franchisees.
Operational Insights
Franchisees should be aware of average operating expenses, which include marketing and advertising at $486,000, operating expenses at $182,000, and general and administrative costs at $119,000. Understanding these financial metrics is crucial for managing profitability and ensuring the success of their Super 8 franchise.
Franchise Support
Super 8 provides comprehensive support to its franchisees, including training programs, marketing resources, and ongoing operational assistance. This support system is designed to help franchisees navigate the challenges of running their business and maximize their chances for success in the competitive hospitality industry.
Frequently Asked Questions
The initial investment for a Super 8 franchise ranges from $231,769 to $4,667,834, which includes the franchise fee, equipment, and other startup costs.