McAlister’s Deli Franchise FDD, Profits & Costs (2025)
McAlister’s Deli, established in 1989 in Oxford, Mississippi, by retired dentist Dr. Don Newcomb, is a fast-casual restaurant chain that has grown significantly since its inception.
Originally envisioned as a neighborhood restaurant and gathering place, McAlister’s Deli first opened its doors with a menu that included their now-famous sandwiches, giant baked potatoes, salads, and sweet tea.
The brand started franchising in 1994, indicating a strong growth trajectory that continues to this day. Headquartered in Atlanta, Georgia, McAlister’s Deli is part of the Focus Brands portfolio, a testament to its sustained expansion and popularity.
McAlister’s is distinguished by its genuine hospitality and a broad menu that includes deli sandwiches, spuds, soups, salads, desserts, and their signature McAlister’s Famous Sweet Tea.
The franchise has also incorporated modern dining conveniences such as mobile app ordering and a loyalty program, enhancing the guest experience and fostering customer loyalty.
Initial Investment
How much does it cost to start a McAlister’s Deli franchise? It costs on average between $1,045,000 – $2,442,000 to start a McAlister’s Deli 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, McAlister’s Deli offers 2 types of franchises:
| Restaurant Type | Initial Investment Range |
|---|---|
| Endcap or Inline Shopping Center Location | $1,044,975 to $1,610,700 |
| Newly-Constructed Freestanding Location | $1,247,725 to $2,442,200 |
We are summarizing below the main costs associated with opening a McAlister’s Deli Newly-Constructed Freestanding Location. For more information on costs required to start a McAlister’s Deli franchise, refer to the Franchise Disclosure Document (Item 7).
| Type of Expenditure | Amount |
|---|---|
| Initial Franchise Fee | $35,500 |
| Construction and Build Out Costs | $578,800 to $1,317,800 |
| Permitting | $6,000 to $15,000 |
| Equipment Package | $241,700 to $298,000 |
| Millwork | $38,000 to $60,000 |
| Furniture | $43,000 to $51,000 |
| Menu Board, Graphics and Interior Signage | $25,000 to $28,000 |
| Exterior Signage | $92,000 to $133,000 |
| Computer System | $22,000 to $58,000 |
| Smallwares | $20,000 to $25,400 |
| TV/Music | $3,000 to $12,500 |
| Architect/Engineer | $24,400 to $64,200 |
| Rent | $7,200 to $18,600 |
| Grand Opening Marketing | $25,000 to $27,000 |
| Legal and Accounting Fees | $3,000 to $10,000 |
| Insurance | $1,925 to $9,500 |
| Misc. Opening Costs / Security Deposits | $5,000 to $33,000 |
| Management Training Program Fee | $0 to $25,000 |
| Travel and Living Expenses during Training | $26,200 to $33,700 |
| On-Site Training Fee | $0 to $34,000 |
| Opening Inventory | $25,000 to $100,000 |
| Additional Funds – 3 Months | $25,000 to $53,000 |
| Total Initial Investment | $1,247,725 to $2,442,200 |
Average Revenue (AUV)
How much revenue can you make with a McAlister’s Deli franchise? A McAlister’s Deli franchised restaurant makes on average $1,792,000 in revenue (AUV) per year.
Here is the extract from the Franchise Disclosure Document:
This compares to $816,000 yearly revenue for similar deli franchises. Below are 10 McAlister’s Deli competitors as a comparison:
Download the Franchise Disclosure Document
Frequently Asked Questions
How many McAlister’s Deli locations are there?
As of the latest data, McAlister’s Deli operates over 560 locations across 29 states. The majority of these locations are franchise-owned, while only a small portion remains company-owned. Recent data indicates that McAlister’s Deli continues to prioritize franchising as its primary growth strategy.
What is the total investment required to open a McAlister’s Deli franchise?
The total investment required to open a McAlister’s Deli franchise ranges from $1,045,000 to $2,442,000.
What are the ongoing fees for a McAlister’s Deli franchise?
McAlister’s Deli franchisees pay a 6% royalty fee on gross sales and a 4% marketing fee, which covers both national and regional advertising efforts. These fees ensure consistent brand support and promotional activities.
What are the financial requirements to become a McAlister’s Deli franchisee?
To become a McAlister’s Deli franchisee, candidates must meet the minimum net worth required of $1.5 million, and prospective franchisees must also have at least $750,000 in liquid capital.
These financial thresholds ensure that franchisees have the necessary resources to support initial startup costs and ongoing operations for the business.
How much can a McAlister’s Deli franchise owner expect to earn?
The average gross sales for a McAlister’s Deli franchise are approximately $1.8 million per location. Assuming a 15% operating profit margin, $1.8 million yearly revenue can result in $270,000 EBITDA annually.
Who owns McAlister’s Deli?
McAlister’s Deli is owned by Focus Brands, a major franchisor and operator of several well-known foodservice brands. Focus Brands, based in Atlanta, Georgia, also owns other popular brands such as Auntie Anne’s, Cinnabon, and Moe’s Southwest Grill.
Disclaimer
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