In the United States, official restaurant-franchise examples range from about $199,000 to more than $2.6 million in estimated initial investment—but those figures cover different brands and restaurant formats, not a comparable industry average. Subway estimates $199,135–$536,745 for a U.S. restaurant; McDonald’s lists $1,470,500–$2,642,000 for a traditional restaurant. The actual amount depends on the specific offer, site and format, so use the current Franchise Disclosure Document (FDD) and a location-specific estimate to plan.
What the headline investment figures include
A franchise fee is only one part of the startup budget. Total investment can include property and construction or lease costs, equipment and décor, opening inventory, professional and pre-opening expenses, and cash reserves for early operations. The exact mix changes if you are building a new restaurant, converting a site or buying an existing location.
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Subway’s U.S. franchise FAQ lists a $15,000 initial franchise fee and an estimated total investment of $199,135–$536,745, citing FDD Item 7. McDonald’s USA lists a $45,000 initial fee within a $1,470,500–$2,642,000 total investment range for a traditional restaurant. The brands’ FAQ and FDD version years are not shown in the cited results; accessed in 2026. These are examples of different systems and formats, not like-for-like offers.
Illustrative McDonald’s startup costs
McDonald’s franchisee guide breaks out several costs for a new traditional restaurant. The guide says these are estimates subject to change and that actual costs are determined when a specific restaurant is offered to a qualified buyer. Its publication year is not stated in the cited result.
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| Cost item | Guide estimate |
|---|---|
| Initial franchise fee | $45,000 |
| Opening inventory | $20,000–$35,000 |
| Miscellaneous opening expenses | $45,000–$55,000 |
| Additional funds for three months | $250,000–$355,000 |
| Signs, seating, equipment and décor | $900,000–$1,500,000 |
These guide line items are not a substitute for the current FDD or the estimate for the particular restaurant being offered. The cited McDonald’s FDD gives a total traditional-restaurant investment range of $1,470,500–$2,642,000; its version date is not stated in the result.
Why the franchise fee is not the total cost
The fee buys the franchise rights or is part of the franchise arrangement; it does not, by itself, fund the full restaurant. For example, Chick-fil-A’s official franchise page says candidates must provide $10,000 in non-gifted, non-borrowed funds for the initial franchise fee. That is a fee-funding requirement, not a verified total cost to develop and open a restaurant. Do not treat it as the full startup budget.
Ask which costs are paid to the franchisor and which go to landlords, contractors, equipment suppliers or other third parties. Also establish whether the estimate includes deposits, site work, equipment, opening inventory, pre-opening payroll and operating reserves.
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Financial qualifications and cash requirements differ
A published investment range, a franchisor’s financial qualification threshold and the buyer’s actual cash need are separate figures. Requirements are specific to the brand and transaction, rather than universal lending standards.
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- Subway: Its U.S. FAQ states minimum financial requirements of $150,000 net worth and $100,000 in liquid assets per location. It says territory can change the requirements.
- McDonald’s: Its current costs page says it typically requires at least $750,000 in non-borrowed, unencumbered personal funds for purchasing and operating an existing restaurant. It recommends $100,000 working capital per restaurant and $75,000 additional funds for relocation. The page says these figures apply to an existing restaurant; a new restaurant requires greater investment.
These amounts describe different qualification and operating situations. They should not be compared as though they were interchangeable minimums or the total cost of a new build.
Account for recurring fees and operating cash
Opening capital is only one part of affordability. Ongoing charges reduce the cash available for rent, payroll, debt service and other operating needs. The cited brand figures are examples; check the current FDD and agreement for the proposed location.
| Brand and source | Recurring charges stated |
|---|---|
| Subway, U.S. franchise FAQ | Royalty: 8% of gross sales; advertising: 4.5% of gross sales. |
| McDonald’s, franchisee guide | Service/royalty fee: 4% of gross sales; advertising contributions: at least 4%; rent can include fixed and sales-based components, plus other outgoing fees. |
Subway’s cited FAQ version and the McDonald’s guide’s publication year are not stated in the results accessed in 2026. Confirm the current charges in the proposed offer rather than assuming these examples are unchanged.
How to verify the cost for a specific opportunity
- Request the current FDD and proposed agreements. Review the investment and fee disclosures, and check the document’s issue date. In the cited McDonald’s FDD, the buyer must receive the disclosure at least 14 calendar days before signing a binding agreement or making a payment in connection with the proposed sale. That is the timing statement in that FDD; confirm the current federal and state requirements for your transaction and jurisdiction.
- Identify the restaurant format. Ask whether the estimate covers a new build, conversion or resale, and whether the figures apply to the actual location being offered.
- Get an itemized site estimate. Confirm what is included for property work, construction, equipment, inventory, deposits, pre-opening costs and working capital, and what remains your responsibility.
- Build a separate operating cash-flow plan. Account for royalties, advertising, rent, debt service and reserves after opening—not just the amount needed to get the doors open.
- Have the documents reviewed. The cited McDonald’s FDD points buyers to the FTC consumer guide and recommends reviewing the disclosure and agreements with an advisor, such as a lawyer or accountant.
Compare opportunities on the same basis
There is no credible cross-industry average established by the cited figures. To compare actual opportunities, line up the same facts for each offer instead of ranking unlike headline totals.
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- Total initial investment and estimate date
- New build, conversion or existing restaurant
- Franchise fee and required liquid capital
- Construction, equipment, inventory and opening expenses included
- Working-capital allowance and buyer qualification criteria
- Recurring royalty and advertising charges
- Real-estate arrangement and location-specific requirements
The cited sources are Subway’s U.S. franchise FAQ, McDonald’s USA’s cost page, Chick-fil-A’s franchise information page, the McDonald’s USA FDD, and McDonald’s franchisee guide.
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