Mel's Drive-In franchise
2023 filing · August 10, 2023Shares sales figures
Mel's Drive-In at a glance
A classic American diner serving breakfast, lunch and dinner, with beer, wine and cocktails. At the end of 2022 there were 10 Mel's Drive-In locations in the US, 2 franchised and 8 company-owned, so most are run by the company itself.
The business
- Franchisor
- Mel's Drive-In Franchise Group, LLC
- The company that sells the franchises
- Current franchisor selling since
- 2023
- Franchisor based in
- San Francisco, California
What you pay
- Cost to open
- $2.09M–$3.62M
- Fee, build-out and opening working capital
- Franchise fee
- $35,000
- Paid once, when you sign
- Royalty
- 4.5% of net sales
- 4.5% of net sales, paid weekly, plus 0.5% to the brand fund
- Brand fund
- 0.5%
- 0.5% of net sales, paid weekly
- Agreement length
- 10 years
- Franchisor financing
- None offered
Where it is
- US locations, 2022
- 10
- Franchised and company-owned
- Franchised
- 2
- Company-owned
- 8
- Change in 2 years
- 0
- Franchised locations, 2020–2022
- States
- 2
- Most in California and Florida
From Mel's Drive-In Franchise Group, LLC’s 2023 filing; SBA status from the SBA Franchise Directory, October 28, 2026.
Where it ranks
Mel's Drive-In among all franchises with the same figure.
| Figure | Mel's Drive-In | Among all franchises |
|---|---|---|
| Cost to open, midpointHalfway between the low and high estimate | $2,855,000 | Costs more than 95% of franchises |
| Franchise feePaid once, when you sign | $35,000 | Lower than 61% of franchises |
| RoyaltyShare of sales paid to the franchisor | 4.5% | Lower than 92% of brands with a set rate |
| US locationsFranchised and company-owned | 10 | Fewer than 61% of franchises |
How much a Mel's Drive-In franchise costs
Opening one Mel's Drive-In costs an estimated $2,094,000 to $3,616,000. That covers the franchise fee and everything else needed to open, through the first months of working capital.
The biggest costs are tenant improvements & construction ($800,000 to $1,200,000) and leasehold improvements ($400,000 to $900,000). Here is every line of the estimate as filed:
| What it pays for | Range | Low | High |
|---|---|---|---|
| To be made Initial Franchise Fee | $35,000 | ||
| Leasehold Improvements | $400,000 | $900,000 | |
| Studies and Site Work | $2,000 | $5,000 | |
| Lease Cost & Commissions | $10,000 | $30,000 | |
| Architects and Engineers | $25,000 | $50,000 | |
| Tenant Improvements & Construction | $800,000 | $1,200,000 | |
| Design and Decor | $30,000 | $50,000 | |
| Equipment, Fixtures & Fixed Assets | $480,000 | $680,000 | |
| Vehicles | $0 | ||
| Signage | $40,000 | $100,000 | |
| Computers and technology | $20,000 | $35,000 | |
| Opening Inventory & Supplies | $40,000 | $75,000 | |
| Security Deposits | $15,000 | $30,000 | |
| Utility Deposits | $3,000 | $10,000 | |
| Licenses & Permits | $3,000 | $100,000 | |
| Grand Opening Campaign | $7,500 | $15,000 | |
| Franchise Training Expenses | $6,000 | $15,000 | |
| Legal and Accounting | $7,000 | $14,000 | |
| Additional Funds-Working Capital | $100,000 | ||
| New Store Opening Training | $50,000 | $100,000 | |
| Other | $500 | $2,000 | |
| First Month’s Rent | $10,000 | $50,000 | |
| Insurance-Annual Premium | $10,000 | $20,000 | |
| Total | $2,094,000 | $3,616,000 | |
Source: Mel's Drive-In Franchise Group, LLC, 2023 filing, page 18
Mel's Drive-In franchise fee
The franchise fee is $35,000. You pay it when you sign the franchise agreement.
Source: Mel's Drive-In Franchise Group, LLC, 2023 filing, page 12
Royalty and ongoing fees
| Royalty | 4.5% of net sales, paid weekly, plus 0.5% to the brand fund. |
|---|---|
| Brand or marketing fund | 0.5% of net sales, paid weekly. |
The typical franchise royalty is 6% of sales, plus 2% for marketing. See franchise fees and royalties to compare.
Source: Mel's Drive-In Franchise Group, LLC, 2023 filing, page 13
Sales and earnings
Shares figures Mel's Drive-In publishes sales or earnings figures for its locations. The full tables, with notes on which locations are counted, are in its filing.
Source: Mel's Drive-In Franchise Group, LLC, 2023 filing, page 50
- Estimate Estimated yearly sales per location
- $2M–$3.6M
Estimated from the sales that 292 comparable franchises file, matched on industry, format, cost to open, fees and size.
How Mel's Drive-In compares
Of the 58 breakfast franchises on this site, Mel's Drive-In is the most expensive to open and the 36th largest by number of locations.
| Figure | Mel's Drive-In | Typical breakfast brand | Typical franchise |
|---|---|---|---|
| Cost to open, low end | $2.09M | $640K | $222K |
| Cost to open, high end | $3.62M | $1.2M | $477K |
| Franchise fee | $35K | $40K | $40K |
| Royalty | 4.5% | 5% | 6% |
| Brand fund | 0.5% | 1.4% | 2% |
| US locations | 10 | 13 | 21 |
| Closed or left per year | 0% | 3% | – |
| Change in franchised locations, 2 yrs | 0% | +6.7% | – |
| Shares earnings figures | Yes | 46 of 58 | 2,147 of 3,352 |
Typical is the median across the 58 brands in breakfast franchises; typical franchise, across every brand here.
Locations opened and closed
| Year | Franchised | Company-owned | Opened | Closed |
|---|---|---|---|---|
| 2020 | 2 (0) | 8 | 0 | 0 |
| 2021 | 2 (0) | 8 | 0 | 0 |
| 2022 | 2 (0) | 8 | – | – |
Closed or left counts terminations, non-renewals, locations bought back by the franchisor and locations that stopped operating.
See which brands grew most in the fastest-growing franchises rankings.
More in the guides: burger franchise costs and franchise failure rates.
Source: Mel's Drive-In Franchise Group, LLC, 2023 filing, page 53
Where Mel's Drive-In locations are
At the end of 2022, Mel's Drive-In had locations in 2 states. The most are in California and Florida.
- California9
- Florida1
| State | Franchised | Company-owned | Total |
|---|---|---|---|
| California | 1 | 8 | 9 |
| Florida | 1 | 0 | 1 |
Source: Mel's Drive-In Franchise Group, LLC, 2023 filing, page 54
Who owns Mel's Drive-In?
Mel's Drive-In franchises are sold by Mel's Drive-In Franchise Group, LLC.
From Mel's Drive-In Franchise Group, LLC’s 2023 filing.
Lawsuits and bankruptcy
| Lawsuits and regulatory actions | None. The filing says no litigation has to be disclosed. |
|---|---|
| Bankruptcy | None. The filing says no bankruptcy has to be disclosed. |
Franchisors must disclose lawsuits and bankruptcies involving the company, its parents and affiliates, and its executives. Many cases are routine disputes with franchisees over fees or contracts; read the descriptions in the filing and ask current owners about anything that worries you.
Source: Mel's Drive-In Franchise Group, LLC, 2023 filing, litigation on page 12, bankruptcy on page 12
Mel's Drive-In filings
The figures on this page come from Mel's Drive-In Franchise Group, LLC’s 2023 filing, issued August 10, 2023, on record with the NASAA Electronic Filing Depository.
| Filing | Issued | Registry | On this page |
|---|---|---|---|
| 2023 filing | August 10, 2023 | NASAA depository | Costs, fees and locations, 2020–2022 |
Each link opens the filing as a PDF. See the newest filings across all brands.
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