Product category



bonchon franchise restaurant

Bonchon Franchise Costs $203K – $1.2M (+ 2024 Profits)

Here’s what you need to know if you’re interested in opening a Bonchon franchise.

|

KEY FRANCHISEE INFORMATION

Here are the most important stats to know for franchisees.

NUMBER OF LOCATIONS

119

INITIAL INVESTMENT

$203,000 – $1,157,000 

ROYALTY FEE

5.00%
revenue

REVENUE PER YEAR

$1,677,000

Bonchon, a renowned franchise specializing in Korean fried chicken, has made a significant impact since its inception in Busan, South Korea in 2002. Founded by Jinduk Seo, Bonchon, which translates to “My Hometown” in Korean, was born out of Seo’s passion to share the flavors of his hometown with the world. 

After two years of perfecting the signature sauces and fried chicken recipe, Seo introduced Bonchon to the bustling city of New York in 2006, where it quickly became a sensation, evidenced by the need for police to manage traffic around the new restaurant​. Bonchon, the internationally recognized Korean fried chicken franchise, relocated its global headquarters from New York City to Dallas, Texas, as of January 1, 2021.

Bonchon prides itself on its Korean heritage, which is evident in every aspect of the business, from the food to the customer experience. This dedication to authenticity and quality has positioned Bonchon as a leader in the Korean fried chicken market in the U.S​ .

Number of locations

TOTAL UNITS
119
FRANCHISED UNITS
114

Find & compare the best franchises on

Bonchon

Initial investment

Type of ExpenditureAmount (Dine-In Restaurant)
Initial Franchise Fee$35,000
Pre-Opening Training Expenses$6,321 – $19,711
Real Property$6,700 – $25,000
Construction and Leasehold Improvements$412,500 – $590,000
Equipment$125,000 – $193,000
Furniture and Fixtures$45,283 – $66,658
Smallwares and Small Appliances$23,500 – $25,000
Uniforms$1,553 – $1,752
Computer and Point of Sale System and Other Technology$20,000 – $32,000
Inventory to begin operating$8,800 – $10,000
Security deposits, utility deposits, business licenses, and other prepaid expenses$5,000 – $15,000
Professional Fees$4,500 – $6,000
Signs$8,200 – $15,003
Architect and Engineering Fees$29,800 – $33,000
Opening Advertising$5,000 – $10,000
Pre-Opening Labor$9,615 – $20,415
Additional Funds (initial period – 3 months)$20,000 – $60,000
Total$769,000 – $1,159,000

Note: The table above provides a snapshot of the main costs associated with starting the most common franchise format (as disclosed in the Item 7 of the Franchise Disclosure Document). For a complete overview of all the expenses involved with the various formats offered by the franchisor, please consult the Franchise Disclosure Document.

Franchise fees & Royalties

Initial Franchise Fee

The Initial Franchise Fee for opening a single Bonchon Business is $35,000. This fee is non-refundable and must be paid in full upon signing the Franchise Agreement.

Area Development Fee

For those wishing to develop and operate two or more Bonchon Businesses and Restaurants within a defined Development Territory, an Area Development Fee applies. This fee consists of the Initial Franchise Fee for the first Bonchon Business plus a $10,000 deposit for each subsequent Bonchon Business required to be developed. The Area Development Fee is fully earned when paid and is non-refundable.

Continuing Royalty

The weekly Continuing Royalty is set at 5.0% of the previous week’s Gross Revenues after the first twelve months of operations, continuing throughout the remainder of the Initial Term. During any period of default, the rate increases to 15.0% of the previous week’s Gross Revenues.

System Brand Fund Contribution

Franchisees are required to contribute up to 4.0% of Gross Revenues to the System Brand Fund, with the current rate at 1.5%. This contribution is subject to change but will not exceed 4.0% of Gross Revenues.

Required Minimum Expenditure for Local Advertising

Franchisees must spend a minimum of $5,000 on local advertising over the five-month period surrounding the opening of a new restaurant. After the first year, the requirement is the greater of $1,166 per month or 1% of the previous month’s Gross Revenues, increasing to 2% of the previous year’s Gross Revenues for subsequent years.

Advertising Cooperative Contributions

When formed, the minimum contribution to an advertising cooperative is 1% of Gross Revenues, with a maximum of 4%. This rate may change within the 1%-4% range and may only exceed 4% if the cooperative amends its by-laws.

revenue

Revenue & Profits

Find & compare the best franchises on

Bonchon

Franchise Pros and cons

Pros

  • Exclusive territory protection: The franchisor grants its franchisees the right to operate their businesses in a designated area. The franchisor does not license any other franchises or operate competing channels in the protected area.
  • Management training: The brand employs a qualified and skilled operations team. Franchisees receive extensive three weeks of training on the brand’s concept and best operations practices for running a successful business. They also get grand opening assistance and ongoing coaching from brand professionals.
  • Marketing support: The brand has an an experienced marketing and advertising team. It helps franchisees create brand awareness, and engage and attract customers through integrated national and local store marketing strategies, new products, public relations, and social media.
  • Real estate and construction: Bonchon provides its franchisees with experts and guidance on building their restaurants. It offers them criteria for site selection, standard restaurant specifications, building support, and lease negotiation support to help them minimize establishment costs.
  • Multiple dining options: The brand offers a variety of dining options for its customers such as traditional sit-downs, sports bars, and quick-service restaurants appealing to families, corporates, and busy professionals alike. Also, these help franchisees boost their incomes.
  • Flexible franchise models: The franchisor’s franchise formats can fit any real estate size. Franchisees can utilize the available real estate opportunities in their locations by choosing the best build-out options that suit their needs. These options include the fast-casual model, mall model, and small-court model.
  • Franchise support: The brand has an experienced management team and supports its franchisees right from inception and ensures they grow. Franchisees get operational support and growth ideas from the brand’s top leadership and a network of franchise experts who have great success ideas in the industry.

Cons

  • No direct financing: The franchisor does not directly or indirectly finance its franchisees for start-up or development expenses.
  • Not a passive investment: The franchise does not allow absentee business ownership. Franchisees need to be actively involved in the restaurant’s daily operations.
  • Competition: The brand faces some competition from Korean BBQ and other similar chicken BBQ and chicken wings chains like Wingstop, Waba Grill or even L&L Hawaiian Barbecue.

How to open a Bonchon franchise

1. Research and Understand the Brand

  • Learn about Bonchon: Familiarize yourself with the brand’s history, menu, and unique selling propositions.
  • Market Analysis: Conduct research on the local market to ensure there’s demand for Korean fried chicken and minimal direct competition.

2. Financial Assessment

  • Initial Investment: Review your financial capacity to meet the initial investment requirements, including franchise fees, real estate, equipment, and opening inventory costs.
  • Financial Planning: Prepare a detailed business plan with financial projections to understand the path to profitability.

3. Contact Bonchon

  • Initial Inquiry: Reach out to Bonchon through their franchise inquiry form or via email to express your interest in opening a franchise.
  • Receive Information: Bonchon will provide you with initial franchise information, possibly including financial requirements, franchising fees, and an overview of the franchising process.

4. Application Submission

  • Complete Application: Fill out the franchise application form with your personal, professional, and financial details.
  • Documentation: Submit any required legal and financial documents to prove your eligibility as a franchisee.

5. Review and Approval Process

  • Franchise Disclosure Document (FDD) Review: Go through the FDD provided by Bonchon, which contains crucial details about the franchise agreement, fees, and obligations.
  • Interviews and Meetings: Participate in interviews and meetings with the Bonchon franchising team to discuss your application, business plan, and potential locations.

6. Training and Onboarding

  • Training Program: Attend Bonchon’s training program, which may include both classroom and on-site training sessions to familiarize yourself with operational procedures, menu preparation, and customer service standards.
  • Operational Support: Receive guidance on setting up your restaurant, including interior design according to Bonchon’s specifications, equipment installation, and staff hiring.

Disclaimer

Disclaimer: This content has been made for informational and educational purposes only. We do not make any representation or warranties with respect to the accuracy, applicability, fitness, or completeness of the information presented in the article. You should not construe any such information or other material as legal, tax, investment, financial, or other professional advice. Nothing contained in this article constitutes a solicitation, recommendation, endorsement, advertisement, or offer to buy or sell any franchises, securities, or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the franchise and/or securities laws of such jurisdiction.

All content in this article is information of a general nature and does not address the detailed circumstances of any particular individual or entity. Nothing in the article constitutes professional and/or financial and/or legal advice, nor does any information in the article constitute a comprehensive or complete statement of the matters discussed or the law relating thereto. You alone assume the sole responsibility of evaluating the merits and risks associated with the use of any information or other content in this article before making any decisions based on such information or other content.

Interested in a Bonchon franchise?

Request a free consultation with an experienced franchise broker

0