Applebee’s Franchise Costs $6.7M (+ 2023 AUV & Profits)

This article was updated with the 2023 Franchise Disclosure Document

Despite a very strong brand name and over 1,700 locations worldwide, Applebee’s is a very expensive franchise. Indeed, with an average initial investment of $6,768,000, it’s far more than the average investment for fast food franchises at $1.6 million as per our analysis.

So should you really invest in a Applebee’s franchise? Is this a profitable venture?

In this article we’ll look how much you can make with a Applebee’s franchise, how much it costs and whether you go ahead and why. Let’s find out!

Key stats

Franchise fee$35,000
Royalty fee4.0%
Marketing fee4.25%
Investment (mid-point)$6,768,000
Average sales$2,026,000
Sales to investment ratio0.3x
Payback period[franchise_value_investment_payback]
Minimum net worth$1,000,000
Minimum liquid capital$500,000
Source: Franchise Disclosure Document 2023

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About Applebee’s

Applebee’s is an American international restaurant chain focusing on mainstream American dishes such as salads, chicken, pasta, burgers, and “riblets” (Applebee’s signature dish).

Applebee’s was founded by Bill and T. J. Palmer in 1980 and opened its first store in Atlanta, Georgia.

On top of its American dishes menu, it serves steak and tacos, and most locations offer a full bar for alcoholic beverages. Applebee’s concept is casual dining, but it also provides catering, pick-ups, and online deliveries.

It began franchising in 1983 under the brand name “Applebee’s Neighborhood Grill + Bar”. The chain is owned by Dine Brands Global Inc., headquartered in Glendale, California.

Today, the chain has over 1,700 units in the US and other countries worldwide.

Applebee’s franchise pros and cons

Operating an Applebee’s franchise has its pros and cons.


  • Brand popularity: Applebee’s is a famous brand, especially because of its culture of main American dishes. Customers who know Applebee’s will flock to any newly launched restaurant to enjoy its popular menu.
  • Franchise support: franchisees benefit from the franchisor’s support on site selection, construction, and restaurant design
  • Comprehensive training: to make sure that franchisees understand and implement Applebee’s concept correctly, the franchisor offers a detailed 10–12 weeks of training. The training program covers basic restaurant management and operations programs for the directors, general managers, supervisory employees, and kitchen managers.
  • Expansion plans: The brand has established its presence in the domestic and international markets. It also has solid plans to accelerate its international growth. Franchisees looking to be part of the chain’s restaurants can easily venture into new markets.


  • No financing: the franchisor does not provide any direct or indirect financing. Franchisees have to resort to third-party financing, for instance, through the SBA, to fund their restaurant establishment or expansion.
  • Limited menu for vegetarians: the Applebee’s franchise may not be a good option for customers looking for healthy and vegetarian eating options.
  • No exclusive territory protection: the franchisor does not offer their franchisees exclusive territories. It grants franchisees the right to operate their restaurants at a single, specific location. Therefore, franchisees may face competition from franchises granted by the franchisor or from competitive brands that the franchisor controls.

How much do you need to invest for a Applebee’s franchise?

You have to invest around $6,768,000 on average to open an Applebee’s franchise restaurant.

The investment amount is an estimated average: indeed, it varies based on many factors such as land and building size, location and development needs; construction, equipment specifications etc.

In addition to the initial franchise fee of $35,000 which you must pay to the franchisor, you would pay for the building costs, furniture and fixtures, signage, equipment, initial inventory, kitchen display system, business supplies, training expenses, liquor licenses, etc.

Further, the cost to purchase land varies because of geographical location. additionally, the investment cost covers 

Type of ExpenditureAmount
Initial franchise fee$35,000
Building cost$556,000 – $4,000,000
Site work$50,000 – $1,000,000
Furniture, fixtures, equipment and signage$410,000 – $825,000
Kitchen display system$12,000 – $18,000
Pre-opening expenses*$55,000 – $350,000
Liquor license(s)$500 – $1,000,000
Other$895,188 – $4,293,696
Total$2,013,688 – $11,521,696
* insurance, legal, training expenses, etc.)
Source: Franchise Disclosure Document 2023

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How much can you make with a Applebee’s franchise?

On average, Applebee’s franchises made $2,026,000 in sales per year in 2022 (the Average Unit Volume).

This is a major increase vs. 2021 (+40%) as restaurants recovered from the COVID-19 pandemic restrictions.

Unfortunately, Applebee’s doesn’t provide much information about its franchise restaurants financial performance in its latest Franchise Disclosure Document.

Instead, we obtained this number by dividing the total franchise revenue of the franchisor (Applebee’s Franchisor LLC) by the number of franchised restaurants it owns the rights of.

Total franchisor revenue$852 million$1,191 million
Number of franchises*588588
Revenue per franchise$1,450,170$2,025,765
* assuming 2021 as per 2022

How profitable is a Applebee’s franchise?

We estimate that a Applebee’s franchise makes $339,000 in profits per year (that’s a 17% EBITDA margin).

Note that Applebee’s doesn’t provide any detailed information about the financial performance of its franchises in its latest Franchise Disclosure Document. Instead we had to make assumptions which we have summarized below.

Profit and lossAmount% Sales
Gross Profit$1,519,32475%
Marketing and royalty costs$(167,126)8%
Other OpEx$(243,092)12%
Source: Estimates

Is a Applebee’s franchise a good investment?

Before you go ahead and pay the initial franchise fee, you may want to know whether Applebee’s is a good investment opportunity.

Hence you would need to know whether the investment cost is worth the profits.

Even though Applebee’s are profitable businesses (17% EBITDA margin as per our estimates), we find that Applebee’s payback period is very long: 15-20 years on average.

Indeed, the long payback is due to the very high initial investment of $6,768,000.

In other words, you would have to wait 15 to 20 years before you can make profits on your initial investment. This is not the best investment in the restaurant franchise industry.

Keep in mind this is based on the average investment cost of $7 million. Assuming your franchise costs you less, the payback period may be very different. Same goes if your restaurant is more profitable.

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How does it compare vs. other franchises?

FranchiseInvestment ($)Sales ($)Payback (years)Min. net worth ($)Min. liquid capital ($)
Dunkin' Donuts,0001,056,5211.44.9500,000250,000
Krispy Kreme,0003,400,0004.11.62,000,000300,000
Little Caesars,022,850798,1130.88.5350,000150,000
Steak 'n Shake, Milshakes815,6261,346,3321.74.01,500,000500,000
Crumbl Cookies,2241,582,0903.12.1300,000150,000
Taco Bell,4131,650,0003.61.91,500,000750,000
Smoothie King,108573,2690.88.0300,000100,000
Jersey Mike's,3231,220,5862.14.7300,000100,000
Nothing Bundt Cakes,6501,307,2802.42.7600,000150,000
Jimmy John's,650874,8451.73.9300,00080,000
Texas Roadhouse,209,5002,955,5340.79.5n.a.200,000
Kung Fu Tea tea250,125353,2371.44.7n.a.25,000
Burger King,242,9501,215,9701.06.81,500,000500,000
Sonic Drive-In,467,0831,617,0001.16.01,000,000500,000
Panera Bread,290,5002,599,4321.15.97,500,0003,000,000
Pizza Hut,575906,9111.06.9700,000350,000
Dairy Queen Cream1,404,2201,143,1800.88.2750,000400,000
Jack in the Box,195,8001,755,5030.812.51,000,000250,000
Papa John’s,6951,101,1273.12.1750,000250,000
Five Guys,2251,203,3662.42.8500,000250,000
Carl’s Jr.,860,3351,419,5160.88.71,000,000500,000
Baskin-Robbins Cream465,100316,8150.79.8250,000125,000
Applebee’s American5,137,9662,356,9650.514.51,000,000500,000
Denny's American3,785,4591,639,5490.415.41,000,000500,000
Papa Murphy's,174580,4411.35.0275,000125,000
Auntie Anne's,692343,1351.55.6300,000100,000
Firehouse Subs,186888,3561.44.6350,000100,000
Tropical Smoothie Cafe,500961,9692.23.0350,000125,000
Marco’s Pizza,625895,5232.03.3400,000100,000
Cold Stone Creamery Cream310,956417,5881.35.0250,000100,000
Church’s Chicken,195,1471,395,0881.25.71,000,000300,000
Moe’s Southwest Grill,3701,013,3611.35.21,000,000100,000
Tim Hortons,242,7501,188,2401.07.0500,000100,000
Checkers & Rally's,8471,039,7731.25.4750,000250,000
Charleys Philly Steaks,806786,2331.54.3500,000100,000
Buffalo Wild Wings,546,9002,534,1480.79.31,500,000750,000
Rita's Ice Cream215,839248,3401.25.8300,000100,000
A&W Restaurants,750851,2121.16.2350,000150,000
Hungry Howie’s Pizza,682806,8991.93.5750,000200,000
McAlister’s Deli,424,9631,865,8611.35.11,000,000500,000
Round Table Pizza,2501,037,8161.35.0500,000200,000
Qdoba Mexican Eats,250972,9621.54.5
Taco John’s,119,0001,124,9801.06.61,000,000400,000
Scooter’s Coffee,143,250797,1010.79.6500,000200,000
Einstein Bros. Bagels,075885,0111.25.71,000,000536,500
Great American Cookies,275452,7711.25.7250,000100,000
Wienerschnitzel dogs873,300880,9801.06.6600,000250,000
Blaze Pizza,4501,096,4321.37.9500,000300,000
Wetzel's Pretzels,571748,8572.03.4300,00050,000
Pizza Ranch,268,3001,174,0880.418.61,000,000297,000
Del Taco,406,8501,345,3411.07.02,000,000500,000
Schlotzsky’s, Salads1,102,9331,053,3330.322.21,000,000300,000
Captain D’s,7781,067,8160.419.01,000,000350,000
Biggby Coffee,575648,3520.320.0300,000100,000
Which Wich,375281,8860.322.2500,000150,000
Marble Slab Creamery Cream407,360251,0520.416.7250,000100,000
Mountain Mike's Pizza,900865,7130.320.0300,000100,000
Huddle House,743712,4280.513.3600,000300,000
L&L Hawaiian Barbecue,350612,9210.333.3500,000150,000
Chicken Salad Chick, Salads651,0001,202,0200.320.0750,000250,000
Golden Chick,975917,6092.52.62,000,000425,000
Waba Grill,000466,5361.06.51,000,000250,000
Bruster’s Ice Cream Cream663,925466,6960.79.5375,000150,000

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