The cost of a McDonald’s franchise participation manifests in a number of operations. It can therefore, be regarded as a total sum of the costs of all the operations involved in the running and owning the franchise. This article discusses the various costs the franchisee, or the person willing to join the system, is likely to incur in the process. This article provides important information for those willing to join McDonald’s franchising business, with only one assurance; that they will be required to incur a certain cost. The cost of a McDonald’s franchise business to the potential franchisee depends largely on the method of acquisition.
First, those interested in this business line must be in possession of personal resources, amounting to 500,000 dollars. However, the cost varies from restaurant to restaurant and therefore; the aforementioned amount is only at the general scale. Those willing to engage in this business will incur part of the cost of a McDonald’s franchise business by purchasing a new restaurant, or paying to run or operate an already existing one. Those willing to cut this cost will be expected to go for the second option. Purchasing a new restaurant will require a down payment of about 40%, while those willing to run an existing will be required to pay a 25% down payment. The payment is sourced from non-borrowed resources such as liquid cash and business or real estate equity, among others. Once the down payment has been made, the franchisee can cover the rest within seven years. The franchisee may benefit from services provided by a variety of lenders that the company has formed strong links with. This form of financing will make the franchisee feel at ease in meeting the cost of a McDonald’s franchise business. Other costs manifests in the following categories; service fee (4% of the restaurants monthly sales) and; rents (also, a percentage of the monthly sales).