How Waffle House is run
In 2016 the company owned about 80 percent of its more than 1,800 restaurants. Typically only expansion plans from existing, successful franchisees are considered, and the company prefers to build its own restaurants from the start. (Atlanta Magazine, June 2016)
Franchises like Waffle House
If you want to own a diner business, these franchise brands sell the closest thing to Waffle House, largest first.
| Brand | Cost to open | Fee | Royalty | Locations | Sales a location |
|---|---|---|---|---|---|
| IHOPFee $50K · Royalty 4.5% · Sales $2.01M a location | $1.91M–$3.33M | $50K | 4.5% | 1,642−4 in 3 yrs | $2.01M |
| Denny'sFee $30K · Royalty 4.5–7% · Sales $1.95M a location | $1.62M–$3.06M | $30K | 4.5–7% | 1,274−171 in 3 yrs | $1.95M |
| Huddle HouseFee $35K · Royalty 4.75% · Sales $796K a location | $555K–$2.38M | $35K | 4.75% | 269−34 in 3 yrs | $796K |
| Perkins Restaurant & BakeryFee $40K · Royalty 4% · Sales $1.93M a location | $1.31M–$3.28M | $40K | 4% | 257−22 in 3 yrs | $1.93M |
| Black Bear DinerFee $55K · Royalty 4.5% · Sales $2.82M a location | $1.5M–$2.24M | $55K | 4.5% | 169+16 in 3 yrs | $2.82M |
| The Original Pancake HouseFee $60K · Royalty 2% of gross sales | $483K–$1.67M | $60K | 2% of gross sales | 151+4 in 3 yrs | – |
| Village InnFee $35K · Royalty 4% of gross sales · Sales $1.98M a location | $1.08M–$2.75M | $35K | 4% of gross sales | 109−14 in 3 yrs | $1.98M |
| Eggs Up GrillFee $45K · Royalty 5% · Sales $1.37M a location | $822K–$1.14M | $45K | 5% | 105+46 in 3 yrs | $1.37M |
Locations are US locations, franchised and company-owned, at the end of the latest year filed. Sales are yearly, before costs, where the brand publishes them.
IHOP is the largest, with 1,642 US locations, and The Original Pancake House costs least to open, from $482,500. Eggs Up Grill added the most locations, +46 over 3 years. Of the brands that publish sales, Black Bear Diner reports the most per location, $2.82M a year. The typical breakfast franchise starts at $640K to open; see where the money goes.
Sources
Questions
Which of these diner franchises loses the fewest owners?
IHOP. About 2.0% of its franchised locations a year closed, were terminated or weren't renewed over the years its latest filing covers, against 8.8% a year at Huddle House. Buy-backs by the franchisor and sales to new owners don't count as exits. Failure rates by brand