Randy’s Donuts Franchise FDD, Profits & Costs (2025)
Randy’s Donuts, established in 1953, is a legendary donut shop and a cultural landmark in Los Angeles, California. Its iconic giant rooftop donut has become a symbol of the city, drawing visitors from across the globe and featuring prominently in movies, music videos, and TV shows. Based in Inglewood, California, the brand has grown to include multiple locations throughout the state.
In 2019, Randy’s Donuts began franchising, creating opportunities for dedicated entrepreneurs to open their own stores. Known for its fresh, handmade donuts prepared daily, the brand has built a strong reputation for exceptional quality and consistency, making it a beloved choice among locals and tourists.
What sets Randy’s Donuts apart is its distinctive branding and unwavering commitment to tradition. By preserving its classic recipes, the shop has secured its place as one of the nation’s most highly rated donut establishments.
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Initial Investment
How much does it cost to start a Randy’s Donuts franchise? It costs on average between $277,000 – $1,192,000 to start a Randy’s Donuts franchised restaurant.
This includes costs for construction, equipment, inventory, and initial operating expenses. The exact amount depends on various factors, including the type of restaurant you choose, the location, and whether the franchisee chooses to lease or purchase the property. Indeed, Randy’s Donuts offers 3 types of franchises:
| Location Type | Initial Investment |
|---|---|
| Kiosk (Non-Baking) | $277,000 to $374,000 |
| Drive-Thru Location | $998,000 to $1,192,000 |
| In-Line (Non-Drive-Thru) Location | $606,000 to $749,000 |
We are summarizing below the main costs associated with opening a Drive-Thru Randy’s Donuts Location.
For more information on the various types of franchises and its costs, refer to the Franchise Disclosure Document (Item 7).
| Type of Expenditure | Amount |
|---|---|
| Initial Franchise Fee | $35,000 |
| One Month’s Rent | $7,000 – $15,000 |
| One Month’s Security Deposit | $7,000 – $15,000 |
| Architect Fee | $30,000 – $45,000 |
| Construction / Leasehold Improvements | $725,000 – $800,000 |
| Furniture, Fixtures, and Equipment | $85,000 – $105,000 |
| Surveillance System | $5,000 – $7,000 |
| Signage | $10,000 – $20,000 |
| Opening Inventory and Supplies | $7,500 – $12,000 |
| Point-of-Sale and Computer Systems | $11,000 – $13,000 |
| Market Introduction Program | $10,000 |
| Training Expenses | $10,000 – $15,000 |
| Travel-Related Expense Reimbursement for On-Site Opening Assistance | $5,000 – $10,000 |
| Insurance (Annual) | $5,000 – $7,500 |
| Professional Fees | $2,500 – $7,500 |
| Business Licenses and Permits | $3,000 – $5,000 |
| Miscellaneous Opening Costs | $10,000 – $20,000 |
| Additional Funds – 3 Months | $30,000 – $50,000 |
| TOTAL ESTIMATED INITIAL INVESTMENT (including real estate costs) | $998,000 – $1,192,000 |
Average Revenue (AUV)
How much revenue can you make with a Randy’s Donuts franchise? A Randy’s Donuts franchised store makes on average $1,387,000 in revenue (AUV) per year.
Here is the extract from the Franchise Disclosure Document:
This compares to $811,000 yearly revenue for similar baked goods franchises. Below are a few Randy’s Donuts competitors as a comparison:
The most profitable franchises to own in 2025
We have compiled the list of the top 400 franchises across 9 industries. Download the report below.
Randy’s Donuts Franchise Disclosure Document
Frequently Asked Questions
How many Randy’s Donuts locations are there?
As of the latest data, Randy’s Donuts operates 44 locations, with plans to expand to over 50 by year-end. The majority of these are franchise-owned, while a smaller number remain company-owned.
What is the total investment required to open a Randy’s Donuts franchise?
The total investment required to open a Randy’s Donuts franchise ranges from $277,000 to $1,192,000.
What are the ongoing fees for a Randy’s Donuts franchise?
Randy’s Donuts franchisees are required to pay an ongoing royalty fee of 5% of gross sales. Additionally, there is a brand fund contribution, commonly referred to as a marketing fee, which ranges between 2% and 4% of gross sales. These fees support the franchisor’s continuous efforts in brand development, operational support, and marketing initiatives, ensuring the franchise’s sustained growth and success.
What are the financial requirements to become a Randy’s Donuts franchisee?
To qualify as a Randy’s Donuts franchisee, candidates must demonstrate a minimum net worth of $1 million, with at least $300,000 in liquid assets. These financial criteria ensure that potential franchisees possess the necessary resources to support the initial investment and ongoing operational expenses associated with establishing and maintaining a Randy’s Donuts location.
How much can a Randy’s Donuts franchise owner expect to earn?
The average gross sales for a Randy’s Donuts franchise are approximately $1.39 million per location. Assuming a 15% operating profit margin, $1.39 million yearly revenue can result in $209,000 EBITDA annually.
Who owns Randy’s Donuts?
Randy’s Donuts is owned by lawyer and entrepreneur Mark Kelegian, who acquired the company in 2015. Under his leadership, the brand has expanded significantly, opening multiple franchise locations both domestically and internationally.
Disclaimer
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