How much it costs to buy a franchise in South Africa

Have you ever wondered, how much it cost to buy a franchise in South Africa? If you did then, you will love this. Below you will find a list of the costs of opening a new franchise in South Africa.

The size of the restaurant, location, pre-opening expenses, inventory, selection of equipment, signage, seating and style of decor and landscaping will affect this cost.

Franchise Set-up cost Franchise fee Monthly payment (% of gross)
KFC R5 500 000 – KFC is not offering any franchise opportunities any more. ( From time to time, existing KFC franchisees may elect to sell their businesses, and it is therefore possible to become a new KFC franchisee by purchasing an existing KFC business. Please note, however, that approval of any new franchisee into the KFC system is at the sole and unfettered discretion of the KFC franchisor.)

Franchise financing organisations

Burger King R5 000 000. Double click this video

McDonald’s McDonald’s South Africa estimates the cost of a franchise to be anywhere between R4 million – R6 million, depending on the type of restaurant and other factors.

Applicants are are also expected to have a minimum of 35% of the purchase price of a restaurant in unencumbered, non-borrowed cash.

Franchise financing organisations

Nando’s Fees

Application Fee: R20 000.00 (Vat Inclusive)

Franchise Fee: R220 000.00 (VAT exclusive)

Establishment Costs

Approximately R6 560 000.00 Plus VAT (but including the items listed under “Initial Working Capital” below)

Initial Working Capital

Approximately R500 000.00 (Excluding VAT) This figure comprises: (This the franchisee must budget for in their own capacity – it is not Nando’s responsibility)

R110 000.00 initial stock

R390 000.00 Other Working Capital, deposits and pre-opening expenses

Breakdown of average Total Investment

Approximately R6 060 000.00 (Excluding VAT)

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Franchise financing organisations

Chicken Licken
  • Chicken Licken® store costs: R4,8 million
  • Chicken Licken® Fly-Thru cost: R6,8 million minimum, dependent on the landlord contributions and which store you choose to build as well as which store best suits the area. The initial franchise fee is R150,000.00.
  • Chicken Licken® extracts a royalty fee (6%) and advertising share (6%) that account for 12% of the franchise’s turnover.
  • Chicken Licken® does not provide finance, though financial organisations normally require that the applicant provide approximately 50% of the loan.

Monthly payments are 12% of turnover made up of:

  • Royalty fee 6%
  • Advertising share 6%
  • The duration of the franchise agreement is 10 years or as per shopping centre lease duration

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Franchise financing organisations

Pizza Hut Access to verifiable development capital of R25 Million ( a minimum of 40% of which must be equity )

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Franchise financing organisations

Wimpy R1 930 000 R114 300 12%
Roman’s Pizza R1 800 000 R 70 000 8%

Debonaires R1 720 000 R130 000 12%
Barcelo’s R1 600 000
Domino’s Pizza R1 500 000
Kauai R1 300 000 R110 000 10%
Steers R1 200 000 R130 000 11%
Subway R1 100 000
Cinnabon R1 000 000 7.5%
Burger Perfect R   970 750 R 65 000 8%
Anat R   950 000 R100 000 8%
Scooter’s Pizza R   950 000 12%
Pizza Perfect R   830 000 R 65 000 9%
1+1 Pizza R   800 000 7%
Zebro’s Chicken R   756 000 R 75 000 4%
London Pie R   675 750
King Pie R   550 000 R 54 000
Fish & Chip Co. R   525 439 R120 000 R4 400

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