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Chili's Grill & Bar
Chili's is a full-service restaurant chain that operates globally across the Americas, Europe, Asia, and the Middle East. The restaurant offers an American and Tex-Mex-influenced menu with a variety of items, such as burgers, ribs, and fajitas, but also has vegetarian options. Chili's is owned and operated by Brinker International, the same company that owns Maggiano's Italian restaurant. In the midst of competition, Chili's stands out by implementing a generous rewards program meant to attract current and future customers by offering free chips and salsa or a free non-alcoholic beverage to members upon each visit. More about the cost of owning a Chili’s Grill & Bar franchise is below.
Facts & figures
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Chili's Franchise Formats Offered
A new Chili's franchisee can choose from two restaurant formats:
Chili's Grill & Bar is the franchise's standard restaurant format.
- These are casual restaurants offering full-service dining and a bar.
- The restaurants are typically free-standing units covering around 5,000 square feet and containing approximately 134 seats in the restaurant area and 30 seats in the bar area.
Chili's Special Venue restaurants are specialized, smaller-footprint establishments.
- Special Venue units can be constructed in a variety of forms, including as free-standing units, in food court locations, in-line / end-cap type finish-outs, or as counter service interior finish-outs.
- Chili's Special Venue locations don't have a prescribed footprint, but typically range from 2,000 - 5,000 square feet and typically contain 70 - 210 seats.
Chili's Franchise Opportunities - History
Chili's opened its doors for the first time in 1975 in Dallas, Texas. Founder Larry Lavine had high hopes of succeeding in the full-service restaurant business, offering a menu with a variety of different hamburgers at an affordable price. Lavine's business concept prospered, and by the early 1980s, there were more than 28 thriving Chili locations throughout the US. The restaurant chain was sold in 1983 to Norman E. Brinker, a restaurant executive that eventually opened Brinker International, the publicly traded company that Chili's still operates under today.
How Much Does A Chili's Franchise Cost?
The initial investment required to open a Chili franchise location depends on the format chosen. The estimated initial investment required to open a Chili's Grill & Bar franchise is $2.6 million to $4.0 million, including a franchise fee of $40,000 - $60,000. Opening a Chili's Special Venue restaurant requires an estimated initial investment of $1.4 million to $3.5 million, including a franchise fee of $40,000 - $60,000.
In addition to their startup and operating costs, Chili's franchise owners must pay an ongoing royalty fee of 1.25% of monthly gross sales, an ongoing technical services fee of 2.75%, advertising production fees of 0.5%, local advertising program fees of least 2.5%, regional advertising program fees of up to 4%, national advertising program fees of up to 4%, and supplemental marketing program fees of approximately 0.10%.
Beyond significant financial resources, qualifying to become a Chili's franchise owner requires the following:
Domestic Development
Extensive experience in fast casual or casual restaurant ownership or operations
Demonstrated understanding of local consumer tastes, real estate, supplier contacts, and rules and regulations
A team, infrastructure, and resources committed to the growth of the Chili's brand
International Development
- Intention to become a multi-unit restaurant owner
- Hospitality experience, preferably in a hotel or food service
- An existing team and a proven infrastructure to support the opening and operation of multiple restaurants
- Strong local credibility, relationships, and knowledge of local regulations and requirements to ensure the smooth opening and operation of multiple restaurants
Chili's Franchise System Size and Composition
Chili's franchise system has approximately 1,600 units worldwide, around 60% of which are corporate-owned and 40% of which are franchised. Nearly all of Chili's units are U.S.-based, but the brand has begun pushing into international markets. Overall, Chili's units generate around $4 billion in worldwide revenues.
Brinker International
Chili's is owned by Brinker International, a $2 billion market cap restaurant holding company traded on the New York Stock Exchange under the ticker symbol EAT. Brinker owns Chili's as well as Maggiano's Little Italy brand.
