Five Guys franchise cost ranges from $928K to $1.38M per unit (2026 FDD). Full breakdown of franchise and development fees, build-out costs, royalties, and why there is no Item 19.
Quick answer A Five Guys franchise costs $927,850 to $1,375,750 per restaurant per the 2026 FDD Item 7, including a $25,000 franchise fee, plus a $50,000 development fee per restaurant; the royalty is 6% of gross sales plus a Creative Fund of up to 4% (currently 2%). The 2026 FDD has no Item 19, so there is no disclosed AUV. Most buyers sign multi-unit development deals of five or more locations, pushing total commitment near $5 million or beyond.
Opening a single Five Guys restaurant requires a total investment between $927,850 and $1,375,750, according to Item 7 of the 2026 Franchise Disclosure Document parsed in VetMyFranchise’s database. The initial franchise fee is $25,000 per unit. But here’s the catch most prospective franchisees miss: Five Guys almost exclusively awards multi-unit area development agreements, meaning you’re committing to open 5 or more locations within a defined territory over a set timeline. For where that puts Five Guys against every other industry’s entry price, see our breakdown of how much it costs to open a franchise.
That changes the real financial picture dramatically. A five-unit development agreement means you’re looking at roughly $4.6 million to $6.9 million in total capital deployment over several years, plus $250,000 in development fees paid upfront.
Before diving deeper into the numbers, make sure you understand what a Franchise Disclosure Document contains and how to read one critically. The FTC’s consumer guide to buying a franchise is a good companion read on what the disclosure is legally required to tell you.
The per-unit franchise fee is $25,000. Every franchisee also signs a Development Agreement, even for one restaurant, and pays a development fee of $50,000 for each restaurant to be developed ($125,000 per restaurant in Alaska, Hawaii, or Puerto Rico), in a lump sum at signing. That fee sits outside the Item 7 total. A 5-unit agreement therefore means $250,000 upfront in development fees, on top of the $25,000 franchise fee per restaurant.
This fee grants you the right to use the Five Guys brand, operating system, recipes, and supplier network. It does not cover build-out, equipment, or any physical assets. For context on the ongoing fees that come after the initial fee, see our FDD Item 6 guide.
This is the largest single cost category, ranging from $250,000 to $600,000 depending on your market.
| Cost Component | Low Estimate | High Estimate |
|---|---|---|
| Leasehold improvements | $150,000 | $375,000 |
| Kitchen equipment & smallwares | $65,000 | $130,000 |
| Furniture, fixtures & decor | $20,000 | $50,000 |
| POS system & technology | $15,000 | $45,000 |
Five Guys locations typically occupy 1,500-2,500 square feet in inline retail or endcap positions. The brand’s open kitchen design means a significant portion of the build-out budget goes toward the cooking line, exhaust systems, and grease management infrastructure. Markets like Manhattan, San Francisco, or Chicago suburbs push costs toward the high end. Secondary and tertiary markets can come in closer to the low estimate.
| Cost Component | Low Estimate | High Estimate |
|---|---|---|
| Initial food inventory | $8,000 | $15,000 |
| Exterior and interior signage | $15,000 | $40,000 |
| Pre-opening labor and training | $25,000 | $50,000 |
| Grand opening marketing | $10,000 | $25,000 |
Five Guys uses fresh ingredients (never-frozen beef, hand-cut fries, peanut oil), which means your opening inventory costs are higher than frozen-product burger concepts. Pre-opening training requires you and your management team to spend several weeks at Five Guys’ headquarters and an existing location, with travel and lodging on your dime.
Five Guys recommends $50,000 to $100,000 in working capital to cover the first 3-6 months of operations before the restaurant reaches steady-state revenue. This covers payroll, utilities, rent, and food costs during the ramp-up period. Experienced franchise consultants, including our team, generally recommend budgeting closer to 6 months of operating expenses, which can push this figure higher in expensive markets.
| Factor | Five Guys | Shake Shack | In-N-Out | Smashburger |
|---|---|---|---|---|
| Franchise fee | $25,000 | Not franchised | Not franchised | $30,000 |
| Total investment | $928K-$1.38M | N/A (company-owned) | N/A (company-owned) | $575K-$1.1M |
| Multi-unit required? | Yes (5+ units) | N/A | N/A | Preferred |
| Liquid capital required | Not disclosed in FDD | N/A | N/A | $300,000+ |
| Net worth required | Not disclosed in FDD | N/A | N/A | $1,000,000+ |
| Royalty rate | 6% | N/A | N/A | 5.5% |
A critical distinction: Shake Shack and In-N-Out are entirely company-owned. You cannot franchise either brand. This leaves Five Guys and Smashburger as the primary “better burger” franchise options, with Five Guys commanding stronger brand recognition and higher average unit volumes.
Browse other franchise opportunities in our franchise directory or use the AI franchise matcher to find brands that fit your investment range.
Five Guys charges three recurring percentage fees that come directly off your top-line revenue:
| Fee Type | Rate | Basis |
|---|---|---|
| Royalty fee | 6% | Gross sales |
| Creative Fund (advertising) | Up to 4%, currently 2% | Gross sales |
| Local advertising | Up to 2% | Gross sales |
The 6% royalty is right at the industry median for QSR burger franchises. The Creative Fund contribution is capped at 4% of gross sales and currently set at 2% per the 2026 FDD; Five Guys may also require you to spend up to 2% of gross sales on local advertising, with cooperative contributions credited against it. Restaurants in Alaska, Hawaii, and Puerto Rico pay an 8% royalty.
Combined, you’re paying roughly 8% to 12% of gross sales in ongoing fees before you account for rent, labor, or food costs. For a deeper look at how royalties work, read our guide on franchise royalty fees explained.
Five Guys’ 2026 FDD makes no financial performance representation. Item 19 states that the company does not make any representations about the past or future financial performance of franchised or company-owned restaurants. There is no disclosed AUV, median, or quartile, so the AUV figures that circulate for the brand (anywhere from $1.1 million to $1.8 million) are not FDD-backed. Item 20 lists 970 franchised and 613 company-owned restaurants at the end of 2025; call franchisees from that list for actual sales.
The revenue scenario below is an illustration, not a disclosed number. Understanding Item 19 financial performance representations is essential before drawing any income conclusions from these numbers, and the Five Guys FDD profile shows what the brand’s disclosure does and does not report.
Working backward from a hypothetical location doing $1.2 million in annual sales:
| Line Item | Amount | % of Revenue |
|---|---|---|
| Gross revenue | $1,200,000 | 100% |
| Food costs (30-33%) | -$384,000 | 32% |
| Labor costs (25-28%) | -$312,000 | 26% |
| Occupancy/rent (8-12%) | -$120,000 | 10% |
| Royalty (6%) | -$72,000 | 6% |
| Creative Fund (2%) | -$24,000 | 2% |
| Local advertising (up to 2%) | -$24,000 | 2% |
| Other operating expenses | -$96,000 | 8% |
| Estimated pre-tax cash flow | $168,000 | 14% |
At that sales level, this back-of-envelope math suggests roughly $130,000-$180,000 in pre-tax owner earnings. A location doing materially less may struggle to clear $60,000, which barely justifies the capital at risk.
Use our franchise investment calculator to model these numbers against your own financial situation.
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Multi-unit timeline pressure. Your area development agreement includes a strict opening schedule. Miss a deadline, and Five Guys can terminate your rights to remaining units, or even the entire agreement. Delays from permitting, construction, or landlord negotiations don’t necessarily buy you extensions.
Remodel requirements. Five Guys mandates periodic remodels, typically every 7-10 years. These can run $100,000-$250,000 per location and are not optional. The cost is not included in the initial Item 7 investment estimate.
Fresh food waste. The “never frozen” commitment that makes Five Guys popular also creates higher spoilage rates than frozen-product competitors. Daily food cost management requires discipline and experienced kitchen managers.
General manager compensation. In tight labor markets, a qualified GM for a Five Guys location commands $55,000-$75,000 in salary plus benefits. If you’re running multiple units (which you will be), you need a GM at every location, making labor costs your biggest ongoing challenge.
A franchise attorney can help you identify risks buried in the franchise agreement that go beyond what the FDD discloses.
Five Guys is not the cheapest entry point into burger franchising. Brands like Rally’s/Checkers ($300K-$600K) or Sonic ($1.2M but with drive-in format revenues) offer lower per-unit costs. So why pay more?
Brand strength. Five Guys consistently ranks among the top 3 burger brands in consumer preference surveys. That translates to opening-day traffic and sustained customer loyalty that newer or weaker brands can’t match.
Simplicity of operations. The menu is deliberately limited: burgers, fries, hot dogs, milkshakes. No breakfast daypart, no complicated LTOs, no drive-through (in most locations). This operational simplicity reduces training time, lowers error rates, and keeps labor costs more predictable.
Revenue potential. Five Guys does not disclose AUV, so this has to come from franchisee validation. If a 2,000 square foot restaurant does $1.2 million, that is strong revenue per square foot, and many cheaper franchise concepts generate $600,000-$800,000, so the absolute dollar return on Five Guys’ higher investment can still be superior.
The investment makes the most sense for operators who can commit to the multi-unit model, have experience managing restaurant teams, and target markets where Five Guys has limited existing penetration. If you’re evaluating whether franchising or starting your own business is the right path, Five Guys represents the high end of the franchise investment spectrum with correspondingly strong brand support.
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About this analysis The franchise data in this article is drawn from VetMyFranchise's structured analysis of 2,400+ Franchise Disclosure Documents filed with U.S. state regulators. See our data & methodology.
The total investment for a single Five Guys location ranges from $927,850 to $1,375,750 according to the 2026 FDD, plus a $50,000 development fee per restaurant paid under the Development Agreement. Five Guys almost exclusively awards multi-unit area development agreements requiring 5+ locations, which means the total capital commitment is roughly $4.6 million to $6.9 million over the development timeline.
Five Guys very rarely awards single-unit franchise agreements. The brand strongly prefers multi-unit area development deals, typically requiring franchisees to commit to opening 5 or more locations within a defined territory over a specified timeline. If you only want one restaurant, Five Guys may not be the right fit.
Five Guys charges a 6% royalty on gross sales (8% in Alaska, Hawaii and Puerto Rico), plus a Creative Fund contribution of up to 4% of gross sales, currently 2%, per the 2026 FDD. Five Guys can also require up to 2% of gross sales in local advertising. Combined ongoing fees total roughly 8-12% of gross revenue.
Five Guys does not say. Its 2026 FDD has no Item 19, so there is no disclosed average, median, or quartile. As an illustration using industry cost benchmarks, a location generating $1.2 million in annual revenue may produce approximately $130,000-$180,000 in pre-tax owner earnings. Get actual sales from the franchisees listed in Item 20 before relying on any revenue figure.
The 2026 FDD does not publish a minimum net worth or liquid capital requirement. Figures such as $1 million net worth and $250,000 liquid circulate online but are not in the document. Ask the development team what they expect for the number of restaurants you would commit to, and get it in writing.
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