You’ve been eating pecan waffles and smothered Hash Browns at Waffle House restaurants your whole life. You love how the eatery is open 24/7/365 – even when all other places are closed due to holidays or weather. An idea strikes you: Why not become a franchisee and open your own Waffle House location? You have to drive several miles to get to your local restaurant, and there’s not much competition in the immediate area. Unfortunately, Waffle House isn’t currently offering franchise opportunities to the public. But cheer up. Your dream of owning a diner doesn’t have to end here. Keep reading to learn more.
Is Waffle House a franchise? Understanding the ownership model
You may be wondering, are Waffle Houses franchised at all? At one time, a small number of locations were run by franchisees, carefully selected by the company. But today, nearly all restaurants are corporate-owned and operated.
Corporate ownership helps the restaurant chain maintain consistent and high standards across food quality, service, and the guest experience. Plus, not having to coordinate with a network of franchisees makes it much easier to roll out a new menu item or other company-wide change.
Can you open or buy a Waffle House restaurant? What’s actually possible
Unlike many fast food or casual dining restaurants, you can’t buy a Waffle House franchise. Plus, if you purchase land from the company that it no longer needs, you can’t build a Waffle House restaurant on it.
However, if you truly want to operate a Waffle House restaurant, there is a path forward: Get hired as an employee. The company develops and promotes leaders from within. You’ll learn the ropes of the business, and could eventually find yourself overseeing multiple locations and a large team of associates.
Here’s a bonus: Working for Waffle House can also mean partial ownership status. Depending on your position, you’ll have the opportunity to purchase or be given stock in the private company.
Alternatives to a Waffle House-style restaurant franchise
If owning a nationally-known breakfast joint is on your bucket list, you’ve got other options. Denny’s and the International House of Pancakes (IHOP) have been popular for decades and are famous for their food and family-friendly dining atmosphere.
Both restaurants also operate via a franchise model. All of IHOP’s locations are run by franchisees, and 96% of Denny’s locations are franchised.
How much does a Waffle House-style franchise typically cost?
You usually need pretty deep pockets to buy a diner franchise. Since Waffle House doesn’t currently offer franchises, there’s no franchise fee.
However, here’s how financial requirements and franchise costs compare between Denny’s and IHOP for a standard 20-year agreement:
Denny’s
- Liquid capital required: $500,000+
- Net worth required: $1,000,000
- Franchise fee: $30,000
- Royalty fee: 4.5%
- Advertising fee: 3%
- Total approximate initial investment: $1,600,000 to $3,000,000
IHOP
- Liquid capital required: $500,000+
- Net worth required: $1,500,000+
- Franchise fee: $50,000
- Royalty fee: 4.5%
- Advertising fee: 3.5%
- Total approximate initial investment: $1,800,000 to $5,200,000
Can’t foot the whole bill in cash? Franchise financing options exist. For example, the United States Small Business Administration (SBA) partners with banks to offer the 7(a) loan program, which provides loans of up to $5,000,000 to qualified borrowers.
If your dream is to run a Waffle House restaurant, your next step is to visit the Waffle House careers page. But if you’ve got your heart set on owning a diner franchise, you should explore opportunities with Denny’s and IHOP.
If neither of those restaurants seems to be a match, read through our franchise directories for new leads. But no matter what franchise you choose to open, be sure to read the Franchise Disclosure Document thoroughly before committing. Purchasing a franchise will probably be the biggest financial investment of your life!
