What is the typical initial franchise term length for a Del Taco restaurant?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
Our franchise arrangements generally provide for an initial franchise fee per restaurant for a 20-year term, and generally require that franchisees pay royalty and marketing fees based upon a percentage of gross sales. The agreements also require franchisees to pay technology fees, as well as sourcing fees for franchise agreements for both brands.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 58)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the typical initial franchise term is 20 years. This means that when a franchisee signs the franchise agreement, they are granted the right to operate a Del Taco restaurant for a period of 20 years, assuming they comply with the terms and conditions of the agreement.
At the end of the initial term, the franchisee may have the option to renew the agreement for an additional term, subject to meeting certain requirements and paying any applicable renewal fees. The length of renewal terms and the conditions for renewal can vary, so franchisees should carefully review the franchise agreement for specific details.
A 20-year term is a fairly standard length for initial franchise agreements in the restaurant industry. This provides franchisees with a substantial period to build their business, recoup their initial investment, and generate profits. It also gives Del Taco a long-term commitment from its franchisees, ensuring consistency and stability within the franchise system.