How is 'Additional Profit' calculated for an Additional Business of a Chick Fil A franchise?
Chick_Fil_A Franchise · 2025 FDDAnswer from 2025 FDD Document
nitial Business for the month or (ii) in the case of an Additional Business, 50% of the Net Profit for Additional Business for the month;
- (g) "Additional Profit" as to a particular restaurant for each calendar month is (i) in the case of the Initial Business, 50% of the Net Profit for Initial Business for the month or (ii) in the case of an Additional Business, 50% of the Net Profit for Additional Business for the month; "Aggregate Additional Profit" for each calendar month is the sum of the Additional Profit for the month of all restaurants operated by you;
- (h) "Extra Profit" for each calendar month is an advance on Additional Profit in the maximum amount of $1,500; you are not entitled to retain an Extra Profit with respect to any additional restaurants;
- (i) "Daily Deposit" as to a particular restaurant including any associated food truck, for each calendar day is your daily Gross Receipts as adjusted for minor cash expenditures, cash overages and shortages and other cash received;
Source: Item 6 — OTHER FEES (FDD pages 27–40)
What This Means (2025 FDD)
According to Chick Fil A's 2025 Franchise Disclosure Document, the 'Additional Profit' for an Additional Business is determined on a monthly basis. It is calculated as 50% of the 'Net Profit for Additional Business' for that month. The 'Net Profit for Additional Business' is the difference between the Operating Profit for the Additional Business for the month and the Base Operating Service Fee for the Additional Business for the same month.
In simpler terms, Chick Fil A first calculates the Operating Profit for the additional restaurant by subtracting the ordinary and necessary expenses from the Gross Receipts. Then, they subtract the Base Operating Service Fee from this Operating Profit to arrive at the Net Profit for Additional Business. Finally, the Additional Profit is half of this Net Profit. This formula is used to determine the profit sharing between Chick Fil A and the franchisee for each additional restaurant they operate.
This calculation is important for prospective franchisees to understand because it directly impacts their potential earnings from additional Chick Fil A locations. The franchisee only receives a portion of the profit after certain fees are deducted, and the Additional Profit is a key component in determining the overall profitability of each additional business. Understanding these calculations can help franchisees forecast their potential income and make informed decisions about expanding their operations with Chick Fil A.