Risk Score
Pending analysis
Investment Range
$845,000 - $2,690,000
Franchise Fee
$35,000
Total US Locations
9
Business Summary
Chicken Guy! Restaurants operate as fast-casual dining establishments known for their all-natural, antibiotic-free chicken tenders. These tenders are hand-pounded, marinated in fresh lemon juice, pickle brine, buttermilk, and infused with flavorful herbs, and served with a variety of signature sauces. The menu also features loaded fries, mac and cheese, pickle chips, American slaw, dessert items, and a selection of beverages. Chicken Guy! Restaurants may also offer alcoholic beverages, catering, delivery services, and drive-thru options to customers in their local area.
Corporate History
Chicken Guy (Franchisor), LLC was formed in Florida on May 16, 2019. The company began offering Chicken Guy! Restaurant franchises in June 2019. The Chicken Guy! Restaurant concept is named after chef and TV personality Guy Fieri, who owns a 50% interest in Chicken Guy's parent company, Chicken Concept, LLC.
Financial Overview
Investment Range
$845,000 - $2,690,000
Franchise Fee (Low)
$35,000
Franchise Fee (High)
$50,000
Royalty %
6%
Marketing %
4%
Equipment Costs (Low)
$595,000
Equipment Costs (High)
$2,250,000
Working Capital
$62,500
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Chicken Guy's financial condition raises questions about its ability to provide services and support to its franchisees. The franchisor's member equity as of December 25, 2022, was $124,988, which is significantly less than the estimated initial investment for a single restaurant, which ranges from $845,000 to $2,690,000. Regulatory bodies in Illinois and Maryland have required Chicken Guy to post surety bonds and defer initial fees due to its financial situation. Management is required to evaluate if conditions raise substantial doubt about the company's ability to continue as a going concern.
Financing Details
Chicken Guy does not offer any direct or indirect financing options to its franchisees. Franchisees will need to secure their own funding, as Chicken Guy does not guarantee any notes, leases, or other obligations.
Performance Metrics
Total US Locations
9
Franchised Units
6
Corporate Units
3
Avg Square Footage
1,900
Franchising Since
2019
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
Yes
Litigation Summary
Chicken Guy has no litigation history to report.
Bankruptcy History
Chicken Guy's affiliate, Bertucci's Restaurants, Inc., filed for Chapter 11 bankruptcy reorganization on December 5, 2022. The company is currently in the post-confirmation stage and expects to exit bankruptcy in 2024. Thomas Avallone, Chicken Guy's Treasurer and Vice Chairman, serves as Manager and President for Bertucci's, and Jeffrey Sirolly, Chicken Guy's General Counsel and Secretary, serves as Secretary for Bertucci's.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew, Chicken Guy franchisees must provide written notice between 8 to 12 months before the initial term expires. They must not be in default of any agreements with Chicken Guy or its affiliates, or with any real estate, equipment lease, financing instrument, or supplier beyond the cure period. Franchisees must also comply with current training requirements, have the right to remain in possession of their location for the renewal term, and renovate and modernize the restaurant to meet current System image standards. A general release and covenant not to sue must be signed, and a new franchise agreement with potentially different terms, including higher royalty fees and advertising contributions, must be executed, along with paying a renewal fee.
Training & Support Program
Franchisor Assistance
Chicken Guy provides various forms of assistance to its franchisees. Before opening, the franchisor offers site selection guidelines, evaluates and approves proposed sites, provides development training, and furnishes specifications for fixtures, furnishings, equipment, and opening inventory, along with lists of approved suppliers. Chicken Guy also provides construction plans and conducts a final inspection to authorize the restaurant's opening. Franchisees receive a confidential Operations Manual and consultation on development, building layout, employee recruiting, purchasing, and inventory control, in addition to an initial manager training program. After opening, Chicken Guy manages and spends contributions to the Brand Fund (once established) and any Regional Advertising Funds for advertising purposes, and provides guidelines for local advertising. The franchisor may modify the System, including menus, equipment, and appearance standards. It also offers additional training programs, provides periodic advice and consultation through visits, materials, meetings, and communications, conducts inspections, and maintains a list of approved suppliers. Chicken Guy reserves the right to set resale pricing policies for menu items.
Initial Training Hours
126
Training Location
Orlando, Florida
Ongoing Support
After opening, Chicken Guy provides ongoing support by collecting, administering, and spending advertising funds from the Brand Fund (once established) and any Regional Advertising Funds. The franchisor offers guidelines for local advertising, and may modify the System, including menus, product packaging, and restaurant appearance. Chicken Guy also conducts periodic advice and consultation through representative visits, printed or electronic materials, meetings, seminars, and communications. The franchisor performs regular inspections of the restaurants and their operations, provides a list of approved suppliers, and sets resale pricing policies for menu items.
Franchise Requirements
Ideal Candidate Profile
Chicken Guy seeks franchisees who will designate a qualified individual to serve as an Operating Principal for their restaurant. This individual must own at least a 10% equity interest (unless a publicly-held entity), be acceptable to Chicken Guy, successfully complete the initial manager training, and have at least five years of full profit and loss responsibility and accountability with a history of operating at least one restaurant. For development agreements, a Development Principal with similar qualifications and a history of operating the agreed-upon number of restaurants is required.
Industry Experience Required
Yes
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Min Years Experience
5
Operational Details
Location Type
Retail
Owner Participation
Absentee Allowed
Territory Type
Protected
Territory Size Requirements
Chicken Guy! offers two types of territories: Development Territories for multi-unit operators and Protected Areas for single-unit franchisees. For Development Agreements, the Development Territory is a mutually agreed-upon geographic area that can range from a portion of a metropolitan area to a county or a state in less densely populated regions. Its perimeters may be defined by specific street boundaries, county lines, state lines, municipal boundaries, or railroad tracks. For single-unit Franchise Agreements, Chicken Guy! grants a Protected Area around the approved restaurant location. This Protected Area's size varies based on factors like demographics, population density, number of households, population growth, and the competitive environment. Typically, it is defined as a radius around the Chicken Guy! Restaurant, but can also be described by specific street boundaries, county lines, state lines, municipal boundaries, or railroad tracks. Chicken Guy! reserves the right to operate or license others to operate Chicken Guy! Restaurants in Nontraditional Locations (such as airports, stadiums, theme parks, etc.), award national or regional licenses to sell Chicken Guy! products, operate other restaurant brands, and merchandise products through other channels of distribution within these territories. Franchisees operating in Nontraditional Locations do not receive an exclusive territory.
Staffing Notes
Chicken Guy requires that each Franchised Restaurant be under the on-site supervision of an Operating Principal or a restaurant manager who meets Chicken Guy's training qualifications. Franchisees must employ at least two management personnel who have successfully completed the initial manager training program at all times. If the number of qualified management personnel falls below two, the franchisee has 30 days to hire and enroll a replacement manager in the training program. Franchisees or their certified managers are responsible for training all newly hired team members, and Chicken Guy will not authorize a restaurant's opening until an adequate number of employees have successfully completed this training, as determined by Chicken Guy's discretion based on factors like restaurant size and hours of operation. For a franchisee's first Chicken Guy! Restaurant, Chicken Guy will conduct on-site team member training for non-management staff for seven days before and seven days after the opening date.