Mcdonalds Franchise Costs

People who are interested in opening their own chain of stores should inquire about McDonald's franchise costs before beginning the process. The fast food corporation requires that applicants provide proof of substantial investment income before it will grant a first franchise interview. Since McDonald's franchise costs are rather steep compared to other fast food franchises, those who want to open a franchise need to have a large amount of liquid assets upfront. All McDonald's franchises are owned by operating managers. The company does not allow franchise owners to operate in an absentee or hands-off fashion. As of 2011, McDonald's ranked as the third largest franchise company in the world with 12,465 locations in the United states alone.

McDonald's franchise costs include a $45,000 franchise fee, but the total required investment is over $1 million per franchise. McDonald's requires that franchise applicants have at least $500,000 in non-borrowed capital before the company will consider their applications. The corporation also stipulates that applicants pay at least 25 percent of the total McDonald's franchise costs down for existing restaurant locations and at least 40 percent of the total McDonald's franchise cost for new restaurants. McDonald's does not extend financing plans for owners, but the company can help franchisees secure low interest rates on loans from financial institutions.

Along with the ability to pay McDonald's franchise costs, franchise owners must have business experience, an understanding of finance, a good credit rating, and proven managerial skills. Interested parties can complete their McDonald's franchise application either on paper or online through the company website. Applicants must provide certain personal information, including contact information, a valid Social Security number, and their current earnings and salary on their applications.