Habit Burger & Grill was born under the golden Santa Barbara sun in 1969. It started as a family-owned business in Santa Barbara County, California, and has since grown into a leading player in the fast-casual burger category, with over 380 restaurants across the United States and internationally in countries such as Cambodia and China.
The brand is known for its chef-driven, award-winning menu that features freshly chargrilled burgers, chicken, and tuna cooked-to-order over an open flame. This cooking method gives their food a distinctive, crave-worthy taste that sets them apart from typical fast-food chains. Habit Burger & Grill emphasizes fresh, high-quality ingredients and offers a variety of options, including crisp salads and handspun shakes, catering to a broad audience seeking feel-good, fresh food.
With a strong commitment to quality and service at affordable prices, Habit Burger & Grill has maintained a loyal customer base for over 55 years. The brand’s laid-back California vibe and focus on fresh flavors have made it a culinary favorite, especially in its home state of California, where it has the majority of its locations.
In 2020, Habit Burger & Grill was acquired by Yum! Brands, the parent company of KFC, Pizza Hut, and Taco Bell, which provides franchisees with the backing of a major restaurant corporation and access to extensive resources and expertise.
Habit Burger & Grill Franchise Cost
Investing in a Habit Burger & Grill franchise requires a significant but reasonable initial investment, consistent with the fast-casual restaurant industry standards. The total investment necessary to open a Habit Burger restaurant ranges approximately from $1.4 million to $1.8 million, depending on the location and format. This range covers build-to-suit end cap and standalone locations, which may include drive-thru options.
Key financial requirements include:
Initial Franchise Fee: $35,000
Royalty Fee: 5.5% of gross sales
Development Fee per Restaurant: $10,000
Total Initial Investment: $1,386,000 to $1,814,000 (before Tenant Improvement Allowance)
Net Worth Requirement: $3,000,000
Liquid Cash Requirement: $1,000,000
These costs cover expenses such as real estate, construction, equipment, signage, initial inventory, training, and working capital. Franchisees must be prepared for a hands-on role, as Habit Burger & Grill is not a semi-absentee or home-based franchise; owners are expected to be involved in daily operations.
Habit Burger & Grill Franchise Conditions
To become a Habit Burger & Grill franchisee, certain conditions and qualifications must be met:
Experience: Preference is given to candidates with restaurant management or operations experience, as the franchise requires active owner involvement.
Financial Strength: Prospective franchisees must meet the net worth and liquid cash requirements to ensure they can support the investment and operational costs.
Commitment: Franchisees must be willing to commit to the brand’s standards and operational procedures to maintain consistency and quality.
Territory: Habit Burger & Grill offers exclusive territories, and franchisees can choose from different real estate formats, including free-standing locations with drive-thrus, end caps, or end caps with drive-thrus, tailored to market demands.
Support is extensive, with the backing of Yum! Brands, providing franchisees with access to site selection assistance, IT systems, marketing, training, and ongoing operational support.
Habit Burger & Grill Franchise Process
The process to become a Habit Burger & Grill franchisee is structured and thorough, designed to ensure alignment between the franchisee and the brand:
Inquiry: Interested candidates start by filling out a Franchise Inquiry Form to express their interest and provide preliminary information.
Initial Discovery Call: A member of the franchise development team contacts the candidate to discuss their background and share more about the brand.
Complete Application: If both parties are interested, the candidate receives a franchise application and Franchise Disclosure Document (FDD) to review and complete.
Application Review Meeting: The franchise team reviews the application with the candidate, discussing business plans, organizational structure, and conducting background checks.
Conversation with CEO and CFO: Candidates have the opportunity to speak directly with Habit Burger’s CEO and CFO to understand the brand’s vision and strategic direction.
Discovery Day: Candidates visit the Habit Restaurant Support Center to meet the executive team, tour restaurants, and learn about operations and ownership in detail.
Finalize Partnership Details: Both parties discuss and agree on business terms, including the Letter of Intent (LOI) and development agreement.
Agreement Execution: Once agreements are signed, the candidate officially becomes a Habit Burger franchisee and begins the journey of opening their restaurant.
This process ensures that franchisees are well-prepared and supported from the initial inquiry through to store opening and beyond.
Habit Burger & Grill Franchise Profit
While exact profits can vary widely depending on location, management, and market conditions, Habit Burger & Grill provides financial transparency through its Franchise Disclosure Document (FDD), including an Item 19 that details financial performance of select franchisees.
Key profit considerations include:
Revenue Potential: Habit Burger & Grill is a fast-growing brand with a strong customer base, especially in California and expanding markets. The brand’s focus on quality and fresh ingredients supports steady customer traffic.
Royalty Fees: Franchisees pay a 5.5% royalty fee on gross sales, which is competitive within the industry.
Operational Support: With 500+ hours of training and ongoing support from Yum! Brands, franchisees are equipped to optimize operations and profitability.
Market Growth: The brand’s expansion into new states and countries indicates growth potential, which can translate into increased sales and profits for franchise owners.
Successful franchisees typically see profits after accounting for operating costs, royalties, and other expenses, but profitability depends on effective management, location choice, and market conditions. The brand’s reputation for quality and customer loyalty provides a solid foundation for sustained earnings.
Conclusion
Habit Burger & Grill offers a compelling franchise opportunity for restaurant owners who want to invest in a well-established, fast-casual brand with a strong heritage and growth trajectory. With a focus on fresh, chargrilled food, backed by the resources of Yum! Brands, franchisees receive comprehensive support from site selection to marketing and operations.
The initial investment, while significant, is in line with industry standards, and the franchise process is designed to ensure that committed, qualified candidates are well-prepared for success. Profit potential is promising, supported by a growing brand presence and strong consumer demand.
For restaurant owners seeking to expand with a reputable brand that combines quality food, operational support, and a proven business model, Habit Burger & Grill is a franchise worth serious consideration.
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