Is Five Guys a Franchise? How Five Guys Franchising Works

Is Five Guys a Franchise? (Direct Answer)

Yes, Five Guys Enterprises LLC operates as a franchise system. The majority of Five Guys’ 1,800+ locations worldwide are franchised. However, Five Guys’ approach to franchising is considerably more restrictive than brands like McDonald’s, Subway, or Burger King. The Murrell family — founders Jerry Murrell and his sons — maintain significant control over the brand and are selective about who they award franchise rights to.

If you’re new to franchising, our guide on what a Franchise Disclosure Document is provides essential context for evaluating any franchise opportunity.

How the Five Guys Franchise Model Works

Area Development Agreements vs. Single-Unit Deals

Five Guys overwhelmingly favors area development agreements (ADAs) over single-unit franchise awards. An ADA commits the franchisee to developing multiple locations — typically 5 or more units — within a defined geographic territory over a set timeline, usually 5-8 years.

The ADA structure means Five Guys franchisees are not individual owner-operators running one restaurant. They’re multi-unit developers building and managing a portfolio of locations. This requires not just capital, but organizational infrastructure: district managers, training systems, HR processes, and supply chain coordination across multiple sites.

For context on how multi-unit ownership works, our multi-unit franchise ownership guide covers the operational and financial differences between single-unit and multi-unit strategies.

Why Five Guys Almost Never Sells Single Units

Five Guys’ preference for multi-unit developers stems from several strategic considerations:

Operational consistency. When one franchisee operates 5-15 locations in a market, quality control is more predictable than when 15 different owners each run a single unit. The franchisee develops market-specific expertise and can cross-train staff between locations.

Faster market penetration. A committed multi-unit developer opens locations on a defined schedule, allowing Five Guys to build market density quickly. Single-unit owners develop markets one store at a time.

Franchise support efficiency. Five Guys’ corporate team can manage relationships with 200 multi-unit groups more effectively than 1,500 individual operators. Field support, communication, and brand compliance all become more manageable.

Financial stability. Multi-unit developers have deeper capital reserves and more sophisticated business operations, reducing the risk of franchise failures that damage the brand.

The downside for prospective franchisees is clear: if you want to own one Five Guys, the brand probably isn’t interested. You need the financial capacity and business experience to commit to a multi-unit development plan.

Five Guys Corporate vs. Franchised Locations: The Split

Metric	Approximate Figure
Total U.S. locations	~1,400
Total international locations	~400+
Franchised locations (U.S.)	~1,100 (78%)
Company-operated (U.S.)	~300 (22%)

Five Guys maintains a higher percentage of company-operated locations than most mature franchise systems. McDonald’s is 95% franchised; Burger King is roughly 99% franchised. Five Guys’ 22% company-owned ratio reflects the Murrell family’s desire to maintain direct operational presence and keep corporate locations as benchmarks for franchise performance.

The company-owned locations are concentrated in the Virginia/D.C. metro area — the brand’s original market — and serve as testing grounds for menu changes, technology rollouts, and operational improvements before they’re pushed to the franchise system.

How the Murrell Family Built (and Still Controls) the Brand

Five Guys’ origin story is one of the more unusual narratives in franchising. Jerry Murrell and his wife Janie opened the first Five Guys in Arlington, Virginia, in 1986. The “five guys” were their four sons (a fifth came later). The family operated a handful of locations in the D.C. metro area for nearly two decades before opening franchising in 2003.

What happened next was explosive. Five Guys went from a regional cult favorite to a national brand in under a decade, growing from 5 locations to over 1,000 by 2013. The growth was fueled almost entirely by franchise development, but the Murrell family retained control through several mechanisms:

Private ownership. Five Guys Enterprises has never gone public. There’s no board of directors answering to public shareholders. Jerry Murrell and his sons make strategic decisions without external pressure for quarterly earnings growth.

Family members in key roles. Multiple Murrell sons hold operational leadership positions within the company, maintaining direct oversight of franchise relations, menu development, and quality standards.

Restrictive franchise agreements. Five Guys’ franchise agreements give the franchisor significant control over sourcing, menu, pricing, and operational standards. Franchisees have less autonomy than in many other QSR systems.

Selective growth. Unlike brands that maximize unit count for franchise fee revenue, Five Guys has been willing to slow growth to maintain quality. The brand reportedly turned down numerous franchise applications during its peak growth years.

How Five Guys Franchising Differs from Shake Shack, In-N-Out, and Smashburger

Factor	Five Guys	Shake Shack	In-N-Out	Smashburger
Franchise model	ADA (multi-unit)	Not franchised	Not franchised	Single + multi-unit
Can you franchise it?	Yes	No	No	Yes
Total investment per unit	$440K-$940K	N/A	N/A	$575K-$1.1M
Minimum units required	5+ (typical)	N/A	N/A	1 (multi preferred)
Family/founder controlled?	Yes (Murrell family)	No (public company)	Yes (Snyder family)	No (private equity)
Menu customization allowed?	None	N/A	None	Limited
Drive-through offered?	Rarely	Some	Yes (all)	Some

The “better burger” segment is dominated by company-owned brands. If you want to own a premium burger restaurant through franchising, Five Guys and Smashburger are essentially your options. Five Guys has stronger brand equity and higher AUVs but demands a much larger commitment. Smashburger is more accessible for first-time franchise investors.

Compare these and other brands in our franchise directory.

Is Five Guys Still Accepting New Franchisees? (Current Status)

Five Guys continues to award franchise agreements, but growth has slowed considerably from the explosive 2008-2015 era. The brand is more focused on international expansion (U.K., Europe, Middle East, Asia-Pacific) than adding domestic U.S. units.

In the U.S., new franchise awards tend to focus on:

• Underserved secondary and tertiary markets
• Territories where existing franchisees want to add units within their ADAs
• Markets where company-owned locations have validated demand

Major U.S. metros — New York, Los Angeles, Chicago, Dallas, Atlanta — are largely built out. If you’re targeting one of these markets, the opportunities may be limited to acquiring existing franchised locations from operators looking to exit rather than developing new territories.

The best way to gauge current availability is to contact Five Guys’ franchise development team directly or work with a franchise broker who has relationships with the brand. Our guide to the franchise buying process outlines how to approach brands and evaluate opportunities.

Who Qualifies to Become a Five Guys Franchisee

Financial requirements:

• Minimum net worth: $1,000,000+
• Minimum liquid capital: $250,000+
• Ability to fund a multi-unit development schedule (5+ locations)

Experience requirements:

• Multi-unit restaurant or retail management experience strongly preferred
• Existing franchise operator experience viewed favorably
• Real estate development or commercial construction background helpful for build-out management

Operational requirements:

• Must be actively involved in operations (absentee ownership not permitted for initial development)
• Must develop locations according to the ADA timeline
• Must maintain Five Guys operational standards across all units

Five Guys does not publish a formal application on its website. Prospective franchisees typically initiate contact through franchise brokers, industry events, or direct outreach to the franchise development team.

Pros and Cons of the Five Guys Franchise Model

Pros:

• Exceptional brand recognition. Five Guys ranks among the top 5 burger brands in the U.S. by consumer awareness and preference. Customers seek out Five Guys — you’re not building brand awareness from scratch.
• Proven unit economics. Average unit volumes of $1.1-$1.3 million in a modest footprint deliver strong revenue per square foot.
• Simple operations. Limited menu, no freezers, no drive-through (usually), no breakfast daypart. Operational complexity is low relative to full-service or multi-daypart QSR concepts.
• Private ownership stability. No public market pressure to over-expand, cut quality, or chase short-term earnings. The Murrell family thinks in decades, not quarters.

Cons:

• Multi-unit commitment required. You can’t test the concept with one unit. The minimum commitment is 5+ locations and hundreds of thousands in development fees upfront.
• Limited menu flexibility. Five Guys’ menu is fixed by corporate. You cannot add local items, seasonal specials, or regional variations. Some franchisees find this constraining.
• No drive-through advantage. Most Five Guys locations lack drive-throughs, which became a significant competitive disadvantage during COVID-19 and continues to limit convenience-driven traffic.
• High food costs. Fresh, never-frozen beef and hand-cut fries cooked in peanut oil cost more than the frozen products competitors use. Food costs of 30-33% are above the QSR industry average.
• Slower growth trajectory. If you want to add units beyond your ADA or expand into adjacent territories, Five Guys may not move quickly. The brand’s conservative growth philosophy can frustrate ambitious operators.

Weigh these factors against your personal goals and financial situation. Our franchise vs. starting your own business analysis can help you decide whether franchising is the right path at all, and Discovery Day is where you’ll get the most candid read on a brand’s culture and expectations.

Frequently Asked Questions