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Taco John’s Franchises Make $1.1M Sales (+ Costs & Profits)

With over 350 restaurants across the US, Taco John’s is another popular Mexican food franchise brand alongside the giant Taco Bell or even QDOBA. But should you invest in a Taco John’s franchise? How much money can you make with this business?

In order to answer these questions, we need to look at the latest Franchise Disclosure Document. With an investment of $1,119,000 on average and a turnover of $1,124,980, Taco John’s does seem like a good business.

In addition to the startup costs and turnover, in this article we will look at how profitable a Taco John’s restaurant really is to find out whether you should really invest in this franchise. Let’s find out!

Taco John’s franchises: key figures

Franchise fee$25,000
Royalty fee5.0%
Marketing fee4.0%
Investment (mid-point)$1,119,000
Median annual sales$1,124,980
Sales to investment ratio1.0x
Investment payback*6.6 years (average)
Minimum net worth$1,000,000
Minimum liquid capital$400,000
* assuming 15% net profit margin

🔎 How does Taco John’s compare vs. other franchises? Check the ranking

What is Taco John’s?

Taco John’s International, Inc. is a prominent American chain restaurant founded in 1969 by John Turner. The fast food restaurant chain is based in Cheyenne, Wyoming, and offers Mexican-styled food and the signature potato oles dish.

Taco John’s is famed for serving the needs of the new generation, and its innovative menu includes burritos, tacos, salads, desserts, and beverages.

The quick-service restaurant started franchising in 1969 after Turner struck a deal with Woodson and Holmes.

Today, it has become a multi-million dollar business with 369 units spread across 22 US states. 

Taco John’s franchises pros and cons

Pros

  • Growth opportunities: Taco John’s has experienced steady growth over the past decades. And partnering with this franchisor provides exciting growth opportunities. 
  • Marketing support: the franchisor provides many resources to help franchisees optimize customer growth. The range of promotional tools includes SEO, ad templates, email marketing, regional advertising, and social media. 
  • Extensive training and support: the franchisor offers extensive hands-on training to help business owners grasp the best in-restaurant management practices including 148 hours of on-the-job training and 22 hours of classroom learning
  • Continual support: the franchisor also offers franchisees support to help with the day-to-day business operations. This includes lease negotiation, online support, security and safety procedures, proprietary software, site selection, and field operations
  • Third-party financing: Taco John’s partners with suitable third-party sources to help franchisees cover the startup costs, equipment, and inventory. 
  • Allows absentee ownership: the franchisor allows passive ownership. Thus, the franchisee doesn’t have to get involved in everyday operations. It favors restaurant owners who value flexibility. 
  • Exclusive territorial protection: as part of the franchise agreement, franchisees get exclusive rights to launch and run their restaurants in designated locations without worrying about competition from similar units. 

Cons

  • Preferences may not suit all franchisees: Taco John’s prefers franchisees with some background experience running multiple franchises or businesses. Novices may find it challenging to start and operate this franchise. 
  • Can’t run the franchise part-time: Taco John’s franchise isn’t a part-time investment. 
  • Minimum employees requirement: there’s a 30-45 minimum number of employees required to run the business. 
  • Competition: currently, Taco John’s is facing competition from other quick service restaurants like Chipotle Mexican Grill, Baja Fresh Corp, and Golden Chick. 

How much does a Taco John’s franchise cost?

To open a Taco John’s restaurant, you need to invest around $1,143,250 upfront.

The mentioned investment amount is an average; thus, it may be different in your your situation.

Indeed, factors like location, the format of the restaurant, and the current market price of the required equipment can affect the amount your must invest. For instance, a traditional restaurant needs twice as much financing vs. a non-traditional restaurant.

Why are you paying this amount? This initial investment covers all the startup costs required by a fast-food restaurant. In addition to the $25,000 initial franchise fee, you would also pay for:

  • Formation Costs: site preparation, construction, operating equipment, furniture, fixtures, decor, point of sale system, digital menu boards, pre-opening training, etc.
  • Marketing Fees: grand opening marketing
  • Operating Costs: initial inventory, additional funds as working capital, etc.
LowHigh
Initial Franchise Fee$20,000$25,000
Formation Costs$1,215,000$1,870,000
Marketing Fees$8,000$12,000
Operating Costs$40,000$57,000
Total$1,283,000$1,964,000
Source: 2022 Franchise Disclosure Document

What’s the turnover of a Taco John’s franchise?

On average, a Taco John’s franchise makes $1,124,980 in sales per year.

The sales number is the average annual sales of 332 franchised restaurants operating in the 2021 fiscal year. 

As the number is an adjusted average, it may change depending on the type of restaurant. To give you an idea, a traditional restaurant generates ~30% more revenue than a non-traditional one.

Type of restaurantNumber of restaurantsAverage sales
Traditional290$1,148,827
End cap27$1,033,776
Convenience store15$828,100
Total332$1,124,980
Source: 2022 Franchise Disclosure Document

How profitable is a Taco John’s restaurant?

On average, a Taco John’s franchise makes $326,244 in annual profits. This represents a 29% profit margin (adjusted EBITDA margin to be exact). 

This 29% profit margin is on the higher end compared to similar franchises as per our intelligence (~25-27% industry average). 

Note that we had to estimate this number. Indeed, Taco John’s doesn’t provide any financial information regarding the costs of its franchises’ operations. Instead, we had to use the industry average for COGS (25% sales), rent (8%), and labor costs (29%).

Profit-and-lossAmount ($)As % of sales
Sales$1,124,980100%
COGS$(281,245)25.0%*
Labor$(326,244)29.0%*
Rent$(89,998)8.0%*
Royalty + marketing fees$(101,248)9.0%
Adjusted EBITDA$326,244~29%
* industry average
Source: 2022 Franchise Disclosure Document

Yet, this adjusted EBITDA does not mean you can keep 29% of the total revenue in your pocket. You would need to deduct taxes, debt interest expenses, and other costs to get to net profits instead.

Is a Taco John’s franchise a good investment?

Now, is it worth investing $1,119,000 to start a Taco John’s franchise? Is this worth the profits?

Assuming a 15% net profit margin (which makes sense in light of the 29% adjusted EBITDA margin), you would need to wait on average 6.6 years to repay your investment. This is a good payback period for fast food restaurant franchises.

Want to buy and open a Taco John’s franchise? Download the business plan with a pre-built 5 year financial plan with the latest numbers from the FDD.

Taco John's business plan template

Download the Taco John’s business plan and get your franchise funded

Including a 5-year financial plan built with the latest Franchise Disclosure Document numbers

How does it compare vs. other franchises?

FranchiseInvestment ($)Sales ($)S/I RatioPayback (years)Min. net worth ($)Min. liquid capital ($)
Chick-Fil-Ahttps://sharpsheets.io/blog/chick-fil-a-franchise-costs-profits/Chicken1,363,5104,227,4173.12.2--
Dunkin' Donutshttps://sharpsheets.io/blog/dunkin-donuts-franchise-costs-profits/Donuts779,0001,056,5211.44.9500,000250,000
Domino'shttps://sharpsheets.io/blog/dominos-franchise-profits-costs/Pizza398,7251,286,4283.23.9250,00075,000
Krispy Kremehttps://sharpsheets.io/blog/krispy-kreme-franchise-costs-profits/Donuts824,0003,400,0004.11.62,000,000300,000
Little Caesarshttps://sharpsheets.io/blog/little-caesars-franchise-costs-profits/Pizza1,022,850798,1130.88.5350,000150,000
Wingstophttps://sharpsheets.io/blog/wingstop-franchise-costs-profits/Chicken631,6951,460,4592.32.91,200,000600,000
Steak 'n Shakehttps://sharpsheets.io/blog/steak-n-shake-franchise-costs-profits/Burger, Milshakes815,6261,346,3321.74.01,500,000500,000
Crumbl Cookieshttps://sharpsheets.io/blog/crumbl-cookie-franchise-cost-profits/Sweets507,2241,582,0903.12.1300,000150,000
Taco Bellhttps://sharpsheets.io/blog/taco-bell-franchise-costs-profits/Mexican462,4131,650,0003.61.91,500,000750,000
Popeyeshttps://sharpsheets.io/blog/popeyes-franchise-costs-profits/Chicken1,095,7831,444,6171.35.11,000,000500,000
Smoothie Kinghttps://sharpsheets.io/blog/smoothie-king-franchise-costs-profits/Smoothie688,108573,2690.88.0300,000100,000
Jersey Mike'shttps://sharpsheets.io/blog/jersey-mikes-franchise-costs-profits/Sandwich574,3231,220,5862.14.7300,000100,000
Nothing Bundt Cakeshttps://sharpsheets.io/blog/nothing-bundt-cakes-franchise-costs-profits/Sweets538,6501,307,2802.42.7600,000150,000
Jimmy John'shttps://sharpsheets.io/blog/jimmy-johns-franchise-costs-profits/Sandwich513,650874,8451.73.9300,00080,000
Texas Roadhousehttps://sharpsheets.io/blog/texas-roadhouse-franchise-costs-profits/Steakhouse4,209,5002,955,5340.79.5n.a.200,000
Kung Fu Teahttps://sharpsheets.io/blog/kung-fu-tea-franchise-costs-profits/Bubble tea250,125353,2371.44.7n.a.25,000
Wendy’shttps://sharpsheets.io/blog/wendys-franchise-cost-profits/Burger1,374,8331,791,2311.35.11,000,000500,000
Burger Kinghttps://sharpsheets.io/blog/burger-king-franchise-costs-profits/Burger1,242,9501,215,9701.06.81,500,000500,000
Sonic Drive-Inhttps://sharpsheets.io/blog/sonic-drive-in-franchise-costs-profits/Burger1,467,0831,617,0001.16.01,000,000500,000
Panera Breadhttps://sharpsheets.io/blog/panera-bread-franchise-costs-profits/Sandwich2,290,5002,599,4321.15.97,500,0003,000,000
Pizza Huthttps://sharpsheets.io/blog/pizza-hut-franchise-costs-profits/Pizza935,575906,9111.06.9700,000350,000
KFChttps://sharpsheets.io/blog/kfc-franchise-costs-profits/Chicken1,802,0501,567,4740.97.71,500,000750,000
Arby’shttps://sharpsheets.io/blog/arbys-franchise-costs-profits/Sandwich1,184,9751,126,2631.07.01,000,000500,000
Dairy Queenhttps://sharpsheets.io/blog/dairy-queen-franchise-costs-profits/Ice Cream1,404,2201,143,1800.88.2750,000400,000
Jack in the Boxhttps://sharpsheets.io/blog/jack-in-the-box-franchise-costs-profits/Burger2,195,8001,755,5030.812.51,000,000250,000
Papa John’shttps://sharpsheets.io/blog/papa-johns-franchise-costs-profits/Pizza353,6951,101,1273.12.1750,000250,000
Zaxby’shttps://sharpsheets.io/blog/zaxbys-franchise-costs-profits/Chicken534,7502,229,1874.22.41,000,000500,000
Hardee’shttps://sharpsheets.io/blog/hardees-franchise-costs-profits/Burger1,759,0001,147,9750.710.21,000,000300,000
Culver’shttps://sharpsheets.io/blog/culvers-franchise-costs-profits/Burger4,044,5003,051,7620.88.82,000,000350,000
Five Guyshttps://sharpsheets.io/blog/five-guys-franchise-costs-profits/Burger511,2251,203,3662.42.8500,000250,000
Carl’s Jr.https://sharpsheets.io/blog/carls-jr-franchise-costs-profits/Burger1,860,3351,419,5160.88.71,000,000500,000
Baskin-Robbinshttps://sharpsheets.io/blog/baskin-robbins-franchise-costs-profits/Ice Cream465,100316,8150.79.8250,000125,000
IHOPhttps://sharpsheets.io/blog/ihop-franchise-costs-profits/Pancakes2,058,3021,553,3110.88.81,500,000500,000
Applebee’shttps://sharpsheets.io/blog/applebees-franchise-costs-profits/Casual American5,137,9662,356,9650.514.51,000,000500,000
Denny'shttps://sharpsheets.io/blog/dennys-franchise-costs-profits/Casual American3,785,4591,639,5490.415.41,000,000500,000
Papa Murphy'shttps://sharpsheets.io/blog/papa-murphys-franchise-costs-profits/Pizza433,174580,4411.35.0275,000125,000
Auntie Anne'shttps://sharpsheets.io/blog/auntie-annes-franchise-costs-profits/Pretzels229,692343,1351.55.6300,000100,000
Firehouse Subshttps://sharpsheets.io/blog/firehouse-subs-franchise-costs-profits/Sandwich613,186888,3561.44.6350,000100,000
Tropical Smoothie Cafehttps://sharpsheets.io/blog/tropical-smoothie-cafe-franchise-costs-profits/Smoothie430,500961,9692.23.0350,000125,000
Marco’s Pizzahttps://sharpsheets.io/blog/marcos-pizza-franchises-costs-profits/Pizza437,625895,5232.03.3400,000100,000
Cinnabonhttps://sharpsheets.io/blog/cinnabon-franchises-costs-profits/Sweets276,062394,8971.45.8300,000120,000
Cold Stone Creameryhttps://sharpsheets.io/blog/cold-stone-creamery-franchise-costs-profits/Ice Cream310,956417,5881.35.0250,000100,000
Jambahttps://sharpsheets.io/blog/jamba-franchise-costs-profits/Smoothie414,562597,0281.47.7300,000100,000
Church’s Chickenhttps://sharpsheets.io/blog/churchs-texas-chicken-fees-sales-costs/Chicken1,195,1471,395,0881.25.71,000,000300,000
Moe’s Southwest Grillhttps://sharpsheets.io/blog/moes-southwest-grill-franchises-costs-profits/Mexican792,3701,013,3611.35.21,000,000100,000
Tim Hortonshttps://sharpsheets.io/blog/tim-hortons-franchises-costs-profits/Coffee1,242,7501,188,2401.07.0500,000100,000
Checkers & Rally'shttps://sharpsheets.io/blog/checkers-franchises-profits-sales-costs/Burger837,8471,039,7731.25.4750,000250,000
Charleys Philly Steakshttps://sharpsheets.io/blog/charleys-philly-steaks-costs-profits/Sandwich509,806786,2331.54.3500,000100,000
Buffalo Wild Wingshttps://sharpsheets.io/blog/buffalo-wild-wings-costs-profits/Chicken3,546,9002,534,1480.79.31,500,000750,000
Rita's Icehttps://sharpsheets.io/blog/ritas-ice-franchise-costs-profits/Ice Cream215,839248,3401.25.8300,000100,000
A&W Restaurantshttps://sharpsheets.io/blog/aw-restaurants-franchises-costs-profits/Burger786,750851,2121.16.2350,000150,000
Hungry Howie’s Pizzahttps://sharpsheets.io/blog/hungry-howies-pizza-franchise-costs-profits/Pizza419,682806,8991.93.5750,000200,000
Bojangleshttps://sharpsheets.io/blog/bojangles-franchise-costs-profits/Chicken1,658,0001,801,0571.16.11,000,000500,000
McAlister’s Delihttps://sharpsheets.io/blog/mcalister-deli-franchise-costs-profits/Sandwich1,424,9631,865,8611.35.11,000,000500,000
Round Table Pizzahttps://sharpsheets.io/blog/round-table-pizza-franchise-costs-profits/Pizza783,2501,037,8161.35.0500,000200,000
Qdoba Mexican Eatshttps://sharpsheets.io/blog/qdoba-mexican-eats-franchise-costs-profits/Mexican659,250972,9621.54.5
Freddy’shttps://sharpsheets.io/blog/freddys-franchise-costs-profits/Burger1,453,0401,792,9291.25.41,000,000400,000
Taco John’shttps://sharpsheets.io/blog/taco-johns-franchise-costs-profits/Mexican1,119,0001,124,9801.06.61,000,000400,000
Scooter’s Coffeehttps://sharpsheets.io/blog/scooters-coffee-franchise-costs-profits/Coffee1,143,250797,1010.79.6500,000200,000
Einstein Bros. Bagelshttps://sharpsheets.io/blog/einstein-bros-bagels-franchise-costs-profits/Sandwich750,075885,0111.25.71,000,000536,500
Great American Cookieshttps://sharpsheets.io/blog/great-american-cookies-franchise-costs-profits/Sweets385,275452,7711.25.7250,000100,000
Wienerschnitzelhttps://sharpsheets.io/blog/wienerschnitzel-franchise-costs-profits/Hot dogs873,300880,9801.06.6600,000250,000
Blaze Pizzahttps://sharpsheets.io/blog/blaze-pizza-franchise-costs-profits/Pizza865,4501,096,4321.37.9500,000300,000
Wetzel's Pretzelshttps://sharpsheets.io/blog/wetzels-pretzels-franchise-costs-profits/Pretzels377,571748,8572.03.4300,00050,000
Pizza Ranchhttps://sharpsheets.io/blog/pizza-ranch-franchise-costs-profits/Pizza3,268,3001,174,0880.418.61,000,000297,000
Del Tacohttps://sharpsheets.io/blog/del-taco-franchise-costs-profits/Mexican1,406,8501,345,3411.07.02,000,000500,000
Schlotzsky’shttps://sharpsheets.io/blog/schlotzskys-franchises-costs-profits/Healthy, Salads1,102,9331,053,3330.322.21,000,000300,000
Captain D’shttps://sharpsheets.io/blog/captain-ds-franchise-profits-costs/Seafood982,7781,067,8160.419.01,000,000350,000
Biggby Coffeehttps://sharpsheets.io/blog/biggby-coffee-franchise-profits-costs/Coffee310,575648,3520.320.0300,000100,000
Which Wichhttps://sharpsheets.io/blog/which-wich-franchises-profits-costs/Sandwich330,375281,8860.322.2500,000150,000
Marble Slab Creameryhttps://sharpsheets.io/blog/marble-slab-franchises-costs-profits/Ice Cream407,360251,0520.416.7250,000100,000
Mountain Mike's Pizzahttps://sharpsheets.io/blog/mountain-mikes-franchise-profits-costs/Pizza410,900865,7130.320.0300,000100,000
Huddle Househttps://sharpsheets.io/blog/huddle-house-franchise-cost-profits/Diner988,743712,4280.513.3600,000300,000
L&L Hawaiian Barbecuehttps://sharpsheets.io/blog/ll-hawaiian-barbecue-franchises-costs-profits/BBQ334,350612,9210.333.3500,000150,000
Chicken Salad Chickhttps://sharpsheets.io/blog/chicken-salad-chick-franchises-costs-profits/Healthy, Salads651,0001,202,0200.320.0750,000250,000
Golden Chickhttps://sharpsheets.io/blog/golden-chick-franchises-costs-profits/Chicken362,975917,6092.52.62,000,000425,000
Perkinshttps://sharpsheets.io/blog/perkins-franchise-costs-profits/Diner1,922,7281,729,2460.97.41,500,000500,000
Waba Grillhttps://sharpsheets.io/blog/waba-grill-franchises-costs-profits/Teryaki454,000466,5361.06.51,000,000250,000
Bruster’s Ice Creamhttps://sharpsheets.io/blog/brusters-franchises-profits-costs/Ice Cream663,925466,6960.79.5375,000150,000