When it comes to the American dream, owning a small business is arguably at the top of the list.
For those who want the autonomy of owning their own business with the safety and security of a large, well-recognized brand, buying a franchise may be the best solution. Sure, you’ll still need to have the proper amount of finances to cover start-up costs like restaurant equipment, business permits, and initial inventory, but once you’re off the ground, you’ll have the corporate support from the brand as well as a dedicated customer base built in.
We wanted to take a look at franchising opportunities around the country. Specifically, we wanted to know where where aspiring entrepreneurs were interested in opening fast food franchises as well as what type of franchise they wanted to open.
To get a sense of this, we took a look at Google search volume trends that were specifically based on searches for franchising opportunities in every state. After analyzing hundreds of different search phrases, here’s what we found.
Fast Food Nation
Depending on where we live, we all have our allegiances to our favorite regional fast food joints (Dunkin’ Donuts in the northeast and Chick-Fil-A in the south)—but which franchises are the most popular to open in each state?
Per Google search volume data, Chick-Fil-A is the most popular fast food franchise to open nationally, and we found that it is also the most popular in the southeast, which includes Texas, Louisiana, Mississippi, Tennessee, Georgia, Florida, South Carolina, North Carolina, Virginia, Maryland, Ohio and Pennsylvania.
According to Google, the second most popular franchise to open in the country is Dunkin’ Donuts. The franchise is specifically the most popular to open in Illinois, New York, New Jersey, Connecticut, Rhode Island and Delaware. Coming in third place for the most popular food franchises to open nationally is Subway, which is also the most popular food franchise to open in Minnesota and New Mexico.
Little Caesars is also a popular franchise choice around the country with Nevada, Utah, Arizona and Kentucky opening them the most. Jimmy John’s—the quick and fresh sandwich shop—is the franchise of choice for Washington, Wisconsin, Missouri, Indiana and Michigan while Montana, South Dakota and Nebraska have been opening up several Burger Kings in their states.
Surprisingly, the fast food kings, McDonald’s, is only the most popular to open in California and Massachusetts, and fast food giant Taco Bell only reigned supreme in Oregon and North Dakota. “Finger lickin’” KFC was only the most popular in Alaska, Idaho and Maine, and just two states were big franchisers of the southern favorite, Waffle House: Iowa and West Virginia. Interestingly, Waffle House does not offer franchise opportunities, but it looks like Iowans and West Virginians are hoping that changes.
Looking at the fast food franchise map, you can see some interesting patterns. First, Chick-Fil-A is clearly dominating in the southeast portion of the country. Dunkin’ Donuts, an east coast mainstay, has a hold of a lot of the northeast, and Little Caesars has solid footing in the southwest.
Most Popular Fast Food Franchises Ranked by Cost to Start
Even though you’ll get plenty of corporate support and have a healthy customer base that has good brand recognition from the beginning, starting a fast food franchise can be costly—and it’s not guaranteed to work. We wanted to know exactly how much the start-up costs would be for the most popular fast food franchises and what the failure rates were for each.
The lowest start-up costs in our list of the most popular franchises was Subway, with start-ups costing between $89,000 and $328,700. In order to start a franchise with Subway, you must have $80,000 in liquid assets with a net worth of $30,000. Subway may have had the lowest start-up costs, but the failure rate was considerably higher than the rest of the restaurants, coming in at a staggering 23%. The second lowest on our list was Chick-Fil-A, which has start-up costs that range between $265,265 and $2.2 million, which is considerably more than Subway. However, the required liquid assets for Chick-Fil-A were only $5,000 and the failure rate for Chick-Fil-A franchises is only 5%.
At the top of our list was KFC, which has start-up costs between $1.4 million and $2.7 million with required liquid assets of $750,000 and a required net worth of $1.5 million, according to company data. Even after all that money spent, KFC had one of the higher failure rates on our list, coming in at 13%. And just below KFC was Qdoba, which costs anywhere from a whopping $936,000 to $2.2 million to start a franchise. The required liquid assets for the fast-casual Mexican chain are $738,000 with a required net worth of $2 million. On the upside, the failure rate was one of the lowest on our list at only 2%.
So, from our list, which franchises are the riskiest to take on? We gathered that the highest failure rate was Subway at 23% and the lowest failure rates were Whataburger and Taco Bell, with a roughly 0% failure rate, according to the U.S. Small Business Administration.