Red Robin franchise cost per the 2026 FDD: $2,705,000 to $5,785,000 before land and liquor license, a $35,000 fee, 5% royalty, and no Item 19 earnings data.
Quick answer A Red Robin restaurant costs $2,705,000 to $5,785,000 to open per Item 7 of the 2026 FDD, excluding real estate and the liquor license. That includes a $35,000 initial franchise fee. Ongoing fees are a 5% royalty plus advertising capped at 4% of gross sales. The FDD makes no Item 19 earnings claim.
Red Robin International, Inc. prices one freestanding prototype restaurant at $2,705,000 to $5,785,000 in Item 7 of its 2026 Franchise Disclosure Document (issuance date April 29, 2026, pages 18 to 21). That is one of the larger single-unit checks in restaurant franchising, and the table title says what it leaves out: “Excluding Real Estate and Liquor License.”
The other numbers in the same document change what that range means. Item 19 is blank. Franchised restaurants have shrunk for three straight years. And the parent company lost money in each of fiscal 2023, 2024 and 2025. This post walks through Items 5, 6, 7, 19 and 20 in order and puts the figures next to other burger and full-service brands in our database.
| Item 7 line | Low | High |
|---|---|---|
| Initial franchise fee | $35,000 | $35,000 |
| Real estate | Variable | Variable |
| Smallwares and supplies | $40,000 | $50,000 |
| Initial inventory | $40,000 | $50,000 |
| Pre-opening expenses (training payroll, legal, deposits, licenses) | $200,000 | $300,000 |
| First-year insurance premium | $50,000 | $80,000 |
| Liquor license | Variable | Variable |
| Site work | $75,000 | $500,000 |
| Pre-construction, due diligence, design, permits | $125,000 | $400,000 |
| Building construction | $1,200,000 | $2,800,000 |
| Furniture, fixtures, décor and equipment | $750,000 | $1,250,000 |
| Exterior signage | $90,000 | $120,000 |
| Additional funds, 3 months | $100,000 | $200,000 |
| Total (excluding real estate and liquor license) | $2,705,000 | $5,785,000 |
Two lines do most of the work. Building construction runs $1,200,000 to $2,800,000 and covers the prototype “from the footings to building completion.” Note 9 says the current prototype is about 5,000 to 6,000 square feet, that the low end assumes a 5,000-square-foot building, and that regional construction costs can push that estimate down 8% or up 35%. Furniture, fixtures, décor and equipment add $750,000 to $1,250,000, including freight, installation, taxes, point-of-sale equipment and décor (Note 10). Together they are $1,950,000 of the $2,705,000 floor, or 72%.
Site work is where a good parcel and a bad one separate. Note 7 puts it at $75,000 to $500,000 depending on demolition, grading, environmental and geotechnical conditions, and utility extensions. The parcel itself ranges from about 10,000 to 87,000 square feet (Note 2). Pre-construction costs of $125,000 to $400,000 assume Red Robin’s prototype adapted to the site “without city or developer modifications,” and Note 8 states that regional tap and impact fees are not included.
Real estate. Item 7 gives no number for buying or leasing the site. Note 2 says leases usually make the tenant pay maintenance, insurance and taxes on top of minimum monthly rent or percentage rent. On a parcel of up to 87,000 square feet, that can be the largest monthly cost in the business.
The liquor license. Red Robin restaurants serve alcohol, and Item 1 says you must obtain a liquor license under state and local law. Note 6 reports that in Red Robin’s recent experience with company restaurants, licenses have cost $3,500 to $750,000 or more, including legal fees. Quota states are the expensive ones: when a municipality has issued its allotment, you buy a license from an existing holder at market price. Note 6 cites Pennsylvania prices ranging from $4,000 to more than $750,000. Pennsylvania happens to hold 20 of Red Robin’s 79 franchised restaurants.
Put together, a buyer in a quota state who pays the high end of Item 7 and the top of the reported liquor range is past $6.5 million before buying or leasing land.
One more line is worth reading twice. The page after the table states that these estimates “are based on a single, freestanding restaurant constructed by us that opened for business in 2023.” The entire Item 7 rests on one company build. Our Item 7 guide explains why the basis of an estimate matters as much as the number.
Item 5 (page 12) sets the initial franchise fee at $35,000 per restaurant, due in a lump sum within 10 days after the Franchise Agreement’s effective date. It is fully earned when paid and non-refundable, with one exception: if you fail to secure the required liquor license by the date the restaurant is ready to open (or is required to open), Red Robin may terminate the agreement and refund the fee. That clause tells you which permit the franchisor treats as the gating risk.
Multi-unit buyers sign an Area Development Agreement and pay a development fee of $12,500 times the number of restaurants in the development schedule, due at signing, non-refundable, in addition to the $35,000 fee for each restaurant as it is developed. A five-restaurant schedule therefore puts $62,500 in Red Robin’s hands before the first site is approved. Miss a development deadline and Item 6 Note 5 lets Red Robin charge $10,000 per month for up to one year to delay terminating the development agreement.
Item 5 also notes that Red Robin and its affiliates sold no company-owned restaurants to franchisees in the fiscal year ended December 28, 2025, and reserves the right to charge fees that are not uniform among franchisees.
See the full Red Robin data sheet
Item 6 (pages 13 to 18) is short on percentages and long on contingent charges.
| Item 6 fee | Amount |
|---|---|
| Royalty | 5% of Gross Sales, paid each 28-day accounting period |
| Advertising (national, regional and local programs combined) | Capped at 4% of Gross Sales |
| Loyalty, gift card and mobile app program costs | Outside the 4% cap, paid by you |
| Transfer fee | $10,000 |
| Late charge | $500 per delinquent payment |
| Interest on overdue amounts | Lesser of 18% per year or the legal maximum |
| Opening crew | Expenses of up to 20 days of Red Robin staff, reimbursed by you |
| Management fee (if Red Robin runs your restaurant) | 10% of Gross Sales plus costs |
| Liquidated damages on termination for default | Average monthly royalty times the lesser of 24 months or the months left in the term |
Red Robin runs on 13 accounting periods of 28 days each, so royalties are paid 13 times a year, not 12. Gross Sales is broad: it includes on-premise, off-premise, catering, online and tabletop-device sales, and excludes only comps, discounts, coupons, employee sales and sales taxes.
The advertising structure deserves a careful read. Item 11 (pages 32 and 33) says Red Robin currently runs a national advertising fund and a cooperative advertising program, and may instead require national, regional and local programs whose combined fees cannot exceed the 4% Maximum Advertising Obligation. In fiscal 2025, 33% of the fund money went to media placement, 20% to production, PR and social, 22% to loyalty and digital platforms, and 25% to administrative expenses. Item 11 also says company restaurants contribute on the same basis as franchisees. The loyalty program, gift card program and mobile app are mandatory, and their costs are expressly excluded from the 4% cap.
At the cap, a restaurant doing $3.0 million in Gross Sales sends $270,000 a year to royalty and advertising combined. We use $3.0 million only because it is close to the company-restaurant figure discussed below. Red Robin does not disclose franchised sales.
Item 19 of the 2026 FDD (page 67) is a non-disclosure. It reads: “We do not make any representations about a franchisee’s future financial performance or the past financial performance of company-owned or franchised outlets.” No average, no median, no cost data, no count of restaurants.
That leaves the audited financial statements of the parent, Red Robin Gourmet Burgers, Inc., attached as Exhibit A. They are not unit economics, but they are the only operating numbers in the document.
| Fiscal year | Restaurant revenue | Franchise revenue | Net loss |
|---|---|---|---|
| 2023 | $1,274.3M | $15.9M | $21.2M |
| 2024 | $1,224.3M | $14.9M | $77.5M |
| 2025 | $1,189.8M | $14.1M | $23.3M |
Source: consolidated statements of operations, 2026 FDD Exhibit A, page 80.
Revenue per company restaurant. Company restaurant revenue of $1,189,780,000 in fiscal 2025, spread over a fleet that went from 407 to 385 restaurants during the year, works out to roughly $3.0 million per company restaurant. That is our division, not a figure Red Robin presents, and it blends in restaurants that closed partway through the year.
Restaurant-level costs. In the same statement, fiscal 2025 cost of sales was 23.9% of restaurant revenue, labor 36.7%, other operating costs 17.9% and occupancy 8.7%. Together that is 87.3%, leaving about 12.7% before depreciation, corporate overhead and selling expense. Company restaurants pay no royalty. A franchisee who matched those cost ratios exactly and paid the 5% royalty would be near 7.7% of sales before advertising, depreciation, debt service and taxes. On a $2.7 million to $5.8 million build, that is the number to stress-test with franchisees, not to assume.
The revenue note (page 88) adds a detail on existing franchisees: they remit 4% to 5% of revenues as royalties and contribute up to 3% to two national advertising funds, and older agreements typically ran 20 years with a right to extend 10 more. The 2026 agreement on offer is 5%, up to 4%, and no renewal right. See our Item 19 explainer for how to underwrite a brand that discloses nothing.
Compare Red Robin’s financial disclosures
Item 20 (pages 68 to 73) shows a system that is getting smaller on both sides.
| Outlet type | Start of 2023 | End of 2023 | End of 2024 | End of 2025 |
|---|---|---|---|---|
| Franchised | 85 | 81 | 80 | 79 |
| Company-owned | 414 | 415 | 407 | 385 |
| Total | 499 | 496 | 487 | 464 |
The franchised detail:
Franchised restaurants are concentrated: Pennsylvania (20), Michigan (19) and Texas (9) hold 48 of the 79. Most other franchise states have one to five units.
The company side moved faster. Red Robin closed 5 company restaurants in 2023, 8 in 2024 and 22 in 2025, across states from California (2) to New Jersey (4) to Illinois (3). That tells you the franchisor’s own operating team found locations it could not make work. Exhibit F lists every franchisee who left the system in the last fiscal year, and Item 20 notes that some current and former franchisees have signed provisions restricting what they can say about their experience.
The fair reading: Red Robin’s franchise base is a group of long-tenured operators, many of whom signed decades ago under older terms, and the brand has not added new franchisees at any measurable pace since 2023.
Red Robin sits between two groups in our burger franchise category: fast-casual burger brands that build smaller boxes, and full-service bar-and-grill brands with similar footprints and liquor licenses.
| Brand | Item 7 range | Item 19 headline (2026 FDD) | Basis |
|---|---|---|---|
| Red Robin | $2,705,000 to $5,785,000 | None disclosed | None |
| Buffalo Wild Wings | $2,463,945 to $4,900,320 | $3,433,937 median AUV | 532 franchised sports bars, 2025 |
| Applebee’s | $616,682 to $5,822,933 | $2,822,904 median gross sales | 1,351 franchised restaurants |
| Freddy’s | $854,834 to $2,802,000 | $1,820,745 median gross receipts | 477 franchised restaurants, 2025 |
The comparison that matters is not who sells most. It is who will show you. Buffalo Wild Wings, the closest match on build cost and service model, discloses quartiles across 532 franchised sports bars. Applebee’s breaks 1,351 restaurants out by Census region. Freddy’s splits by facility type. Red Robin asks for a comparable check with no sales data. Our Buffalo Wild Wings Item 19 breakdown shows what a full-service disclosure can look like, and the best burger franchises ranking covers the fast-casual side, including the Five Guys cost breakdown.
Royalty is not where Red Robin is expensive. Its 5% matches Buffalo Wild Wings and is one point above Applebee’s. The cost is the build, the liquor license and the absence of a performance baseline.
Item 12 (page 47) grants a Limited Protected Area of a 3-mile radius around your restaurant. Inside it, Red Robin will not open or allow another Red Robin restaurant while you are in compliance. The protection does not depend on sales volume. But if you default, the protected area “will automatically terminate,” even if you cure the default. Every Red Robin restaurant may advertise to and accept orders from customers anywhere, including inside your radius.
Item 17 (page 54) sets the term at 20 years, ending on the last day of the last calendar month of the 20th anniversary of the agreement. There is no right to renew. A $2.7 million to $5.8 million investment amortized over a fixed 20-year term, with no contractual renewal, is a different asset from one with successor terms built in.
Item 1 adds one menu note: Red Robin holds a master license with Donatos Pizzeria, and franchisees who want to sell Donatos thin-crust pizza must sign a separate Donatos Nested Restaurant Agreement.
Then call franchisees in Pennsylvania and Michigan, where most of the franchised system sits, and ask them the one question the FDD will not answer: what does the restaurant clear after rent, royalty and advertising?
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About this analysis The franchise data in this article is drawn from VetMyFranchise's structured analysis of 2,300+ Franchise Disclosure Documents filed with U.S. state regulators. See our data & methodology.
Item 7 of the 2026 Red Robin FDD estimates $2,705,000 to $5,785,000 for one freestanding prototype restaurant, including the $35,000 franchise fee. The biggest lines are building construction at $1,200,000 to $2,800,000 and furniture, fixtures, décor and equipment at $750,000 to $1,250,000. The range excludes buying or leasing the land and the cost of a liquor license.
The initial franchise fee is $35,000 per restaurant, due within 10 days after the Franchise Agreement takes effect (Item 5). It is non-refundable except in one case: if you cannot secure the required liquor license by the time the restaurant is ready to open, Red Robin may terminate and refund the fee. Area developers also pay a $12,500 development fee for each restaurant in the development schedule.
The royalty is 5% of Gross Sales, paid each 28-day accounting period (13 per year). Advertising fees across the national, regional and local programs are capped at 4% of Gross Sales. Loyalty program, gift card and mobile app costs sit outside that 4% cap.
The 2026 FDD does not say. Item 19 states that Red Robin makes no representations about the financial performance of franchised or company-owned restaurants. The parent's audited statements, attached to the FDD, show $1.19 billion of company restaurant revenue in fiscal 2025, which works out to roughly $3.0 million per company restaurant by our arithmetic. That is not a franchisor representation.
Item 20 reports 79 franchised restaurants and 385 company-owned restaurants at the end of fiscal 2025, for 464 in total. Franchised units have declined from 85 at the start of 2023, and Red Robin reported no signed-but-unopened franchise agreements and no projected franchised openings.
The Franchise Agreement runs to the last day of the last calendar month of the 20th anniversary of its effective date. Item 17 states there is no right to renew. The protected area is a 3-mile radius, and it terminates automatically if you default, even if you cure the default.
The 2026 FDD offers both single-restaurant and area development agreements, but the activity numbers are thin: one franchised opening in 2023, none in 2024 or 2025, zero franchise agreements signed but not yet open, and zero projected openings. Ask the franchise development team directly how many agreements it signed in 2026.
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