Freddy’s Frozen Custard & Steakburgers continues to be a standout choice for franchisees seeking a scalable, hospitality-driven concept. With a strong brand identity and proven operational systems, Freddy’s offers a compelling investment opportunity in 2025.
Investment Overview
Freddy’s offers three build formats tailored to different site types:
| Format | Estimated Investment Range |
|---|---|
| In-Line (no drive-thru) | $785,936 – $1,198,665 |
| End Cap (with drive-thru) | $1,277,598 – $2,497,566 |
| Standalone (with drive-thru) | $1,487,598 – $2,753,566 |
Cost Breakdown by Category:
| Expense Category | In-Line | End Cap | Standalone |
|---|---|---|---|
| License Fee | $35,000 | $35,000 | $35,000 |
| Training Travel/Lodging | $10,000–$40,000 | $20,000–$60,000 | $20,000–$60,000 |
| Construction/Improvements | $270,000–$500,000 | $750,000–$1,600,000 | $950,000–$1,800,000 |
| POS/Tech/Security | $30,102–$58,665 | $53,764–$99,066 | $53,764–$99,066 |
| Equipment & Décor | $375,000–$400,000 | $350,000–$500,000 | $350,000–$500,000 |
| Inventory & Supplies | $10,000–$25,000 | $10,000–$25,000 | $10,000–$25,000 |
| Grand Opening Advertising | $2,500–$5,000 | $2,500–$5,000 | $2,500–$5,000 |
| Additional Funds (3 Months) | $20,000–$60,000 | $20,000–$60,000 | $20,000–$60,000 |
Franchise Fee Structure:
- Initial franchise fee: $35,000 (non-refundable)
- Development fee: $15,000 per restaurant
- License-fee deposit: $20,000 (credited to first unit)
Ongoing Fees:
- Royalty: 5% of gross receipts (paid weekly)
- National Marketing Fund: 0%–3% (currently 2%)
- Technology Support Fee: $100 per 28-day period
- Co-op Advertising: 0%–2% (if applicable)
- Site Selection: $0–$2,000 per trip (reimbursed)
ROI Performance (2025 FDD)
Freddy’s reported gross receipts across 496 locations:
| Quartile | Average | Median | High | Low |
|---|---|---|---|---|
| Top | $2,606,743 | $2,522,835 | $4,292,651 | $2,235,555 |
| Second | $2,036,267 | $2,021,193 | $2,233,838 | $1,854,078 |
| Third | $1,681,701 | $1,684,015 | $1,851,004 | $1,495,246 |
| Bottom | $1,239,789 | $1,278,037 | $1,494,488 | $765,761 |
| Total | $1,891,124 | $1,852,541 | $4,292,651 | $765,761 |
Franchisee Support
Training Programs:
- Multi-week curriculum covering operations, hospitality, and management routines
- Up to 8 Freddy’s staff deployed for grand opening (franchisee covers $20,000–$60,000)
Operational Support:
- Real estate and site approval guidance
- National marketing fund (2% of gross receipts) and optional co-op advertising (0%–2%)
- Veteran incentives via the Freddy Simon Salute to Veterans program
Technology & Tools:
- Integrated POS, drive-thru systems, headsets, and cameras
- Technology support fee: $100 per 28-day operating period
Franchise Requirements
Eligibility Criteria:
- Liquid assets: $400,000
- Net worth: $1,000,000 (single-unit); $1,500,000 (multi-unit)
- Preferred: Experience in operations/franchising/restaurant leadership
Operational Commitments:
- Owner-led or experienced operating partner model
- Multi-unit developers follow structured development schedules
Funding Assistance:
- Freddy’s may introduce lenders familiar with the system (terms vary)
Franchisee Success Story
“The top reason I was attracted to Freddy’s was because of what the co-founders said when we met them. They believed in the franchisees, they understood the value of what the franchisee brings to the table.”
— Brian Pyle, Multi-Unit Owner (Colorado, Alabama, New Mexico)
Market Potential: Burgers & Custard
The U.S. burger market is valued at $172 billion, growing at a 4.1% CAGR since 2019. Freddy’s leverages this with:
- Premium steakburgers
- Fresh-churned custard
- Multi-daypart appeal
- Nostalgic hospitality
- Simple, scalable operations
Competitive Landscape: Culver’s, Shake Shack, Five Guys, Smashburger — Freddy’s stands out with dessert leadership and repeatable execution.
Application Process
- Experience the Brand: Visit and assess fit
- Apply: Submit a non-binding application
- Intro Call: Connect with the Franchise Development team
- Confirm Fit: Financial and cultural alignment
- Discovery Day: Meet leadership in Wichita, KS
- Finalize Agreement: Territory, unit count, timeline
- Training Begins: Welcome to Freddy
See More: Freddy’s Signs On for Park City’s Ambitious Champtown Development