Freddy’s Frozen Custard & Steakburgers Franchise FDD, Costs & Fees (2024)

KEY FRANCHISE STATS

All you need to know about this franchise in a snapshot

Initial franchise fee
$30,000
Investment required
$794,000 - $2,523,000
Royalty fee
4.50%

Freddy's: Crafting Quality and Community in Frozen Custard and Steakburgers

Freddy's Frozen Custard & Steakburgers was established in 2002 in Wichita, Kansas, by brothers Bill and Randy Simon, along with their friend Scott Redler. The restaurant's concept was inspired by the Simons' father, Freddy Simon, a World War II veteran, whose family values and passion for quality food shaped the foundation of the business.

Based in Wichita, Freddy's is famous for its freshly prepared steakburgers made with lean 100% ground beef, Vienna Beef hot dogs, crispy shoestring fries, and a variety of frozen custard treats crafted from freshly churned chocolate or vanilla custard. The brand stands out due to its commitment to high-quality ingredients, a welcoming dining experience that evokes classic American diners, and a strong emphasis on community engagement.

Freddy's started franchising in 2004, just two years after its first restaurant opened, enabling swift expansion across the United States. Today, the chain boasts hundreds of locations nationwide and has ventured internationally, with its first overseas outlet debuting in Dubai in 2019.

The brand's success is rooted in its unwavering dedication to quality food, prompt and friendly service, and a distinctive dining atmosphere that honors Freddy Simon's legacy. Even with its considerable growth, Freddy's remains focused on food quality and guest satisfaction, eschewing aggressive expansion or marketing tactics.

Initial investment

Here's what you would need to invest if you were to start this franchise. These costs are provided by the franchisor in the Franchise Disclosure Document.

Type of Expenditure In-Line (No Drive-thru) End Cap (With Drive-thru) Standalone (With Drive-thru)
License Fee $30,000 $30,000 $30,000
Training Expenses (Travel, Meals, Lodging, and Employee Wages) $20,000 to $50,000 $20,000 to $50,000 $20,000 to $50,000
Construction, Remodeling, and Leasehold Improvements $372,000 to $750,000 $550,000 to $1,436,465 $650,660 to $1,610,673
Real Property Rent (one month) $5,667 to $15,750 $5,667 to $15,750 $5,667 to $15,750
Security Deposit $5,667 to $15,750 $5,667 to $15,750 $5,667 to $15,750
Computer, Point of Sale Equipment, Outdoor Ordering System and Software, Security Cameras, Drive Thru Headsets $30,102 to $58,665 $53,764 to $99,066 $53,764 to $99,066
Equipment, Furniture, Fixtures and Décor $282,318 to $382,300 $312,480 to $480,100 $312,480 to $480,100
Building Signage / Interior Neon / LED Border $6,000 to $26,640 $12,890 to $53,160 $22,090 to $108,900
Miscellaneous Opening Costs $8,000 to $15,000 $8,000 to $15,000 $8,000 to $15,000
Opening Inventory and Supplies $10,000 to $25,000 $10,000 to $25,000 $10,000 to $25,000
Insurance $2,000 to $5,000 $2,000 to $7,000 $2,000 to $8,000
Grand Opening Advertising $2,500 to $5,000 $2,500 to $5,000 $2,500 to $5,000
Additional Funds – 3 months $20,000 to $60,000 $20,000 to $60,000 $20,000 to $60,000
TOTAL ESTIMATED INITIAL INVESTMENT $794,254 to $1,439,105 $1,032,968 to $2,292,291 $1,142,828 to $2,523,239

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Number of units

2023
Franchised units

353

372

414

Company-owned units

30

34

29

Total units

383

406

443

Franchise Disclosure Document

Training 

Before opening a Freddy’s Frozen Custard & Steakburgers restaurant, franchisees must complete an extensive training program. This program is designed to provide them with the skills and knowledge required to operate their restaurant effectively and maintain the brand's high standards.

The initial training program is compulsory for the franchisee or their appointed representative, the General Manager, and up to two assistant managers.

Typically held at the Freddy's Training Center or an alternative designated location, this training lasts approximately 16 weeks. It covers a wide range of topics related to restaurant operations, including administrative, operational, and managerial responsibilities.

The program includes both classroom instruction and practical, hands-on experience in a Freddy’s restaurant. Franchisees will learn about product preparation, customer service, equipment usage, and management techniques.

Territory Protection

Franchisees receive specific rights within a defined geographical region known as the "Assigned Area." In this Assigned Area, Freddy’s Frozen Custard & Steakburgers promises not to establish or allow others to establish any new restaurants, provided the franchisee adheres to all terms and conditions within the specified timeframe.

Additionally, an "Assigned Territory" is granted, ensuring that no other franchisee or company-owned Freddy’s restaurant will be established within this territory. This Assigned Territory is typically defined by a radius around a particular location, a specific standard metropolitan statistical area, or a city.

However, franchisees are not granted an exclusive territory. They may encounter competition from other franchisees, from Freddy’s Frozen Custard & Steakburgers-owned outlets, or from other distribution channels of competing brands controlled by Freddy’s Frozen Custard & Steakburgers

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