Risk Score
Pending analysis
Investment Range
$298,200 - $1,013,500
Total US Locations
1,927
Business Summary
Wingstop Restaurants operate under the WING-STOP® trade name and business system, serving cooked-to-order, hand-sauced and tossed chicken wings, boneless wings, tenders, and chicken sandwiches in a variety of flavors. They also offer seasoned fries, other foods, and beverages, including beer and wine where permitted. Wingstop locations are typically found in shopping centers, offer limited customer seating, and cater to many customers who order digitally or by phone for off-premises consumption.
Corporate History
The first Wingstop Restaurant opened in July 1994. Wingstop Restaurants Inc. (WRI), the brand's predecessor, incorporated in November 1996 and began offering franchises in May 1997. WRI was the original franchisor until November 2018, when Wingstop Franchising LLC was formed as part of a securitization transaction. All existing U.S. and international franchise agreements were then transferred to Wingstop Franchising LLC, which became the new franchisor. WRI now provides support and services to franchisees under a management agreement with Wingstop Franchising LLC.
Financial Overview
Investment Range
$298,200 - $1,013,500
Franchise Fee (High)
$25,000
Royalty %
6%
Marketing %
5.5%
Equipment Costs (Low)
$193,900
Equipment Costs (High)
$836,500
Working Capital
$32,500
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Wingstop Franchising LLC's financial statements show strong net income, with amounts of $293,060,000 in 2024, $211,192,000 in 2023, and $161,828,000 in 2022. The company is structured as a single-member, special purpose entity in a securitization transaction, requiring it to distribute excess cash flows to its direct parent, Wingstop Funding LLC, for debt obligations. The independent auditors issued an unqualified opinion, indicating the financial statements present fairly. There are no mentions of going concern qualifications or significant financial difficulties for Wingstop Franchising LLC.
Financing Details
Wingstop Franchising LLC does not offer any direct or indirect financing to its franchisees. This means Wingstop does not provide loans, guarantees, or payment plans for items such as the initial franchise fee, equipment, or working capital. Franchisees are responsible for securing their own financing from third-party lenders.
Performance Metrics
Total US Locations
1,927
Franchised Units
1,877
Corporate Units
50
Avg Square Footage
1,600
Franchising Since
1997
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
1
Litigation Summary
Wingstop Franchising LLC is involved in one arbitration proceeding against a former French franchisee, B. Wing & Flight 83 SAS, which began in September 2021. Wingstop initiated the arbitration for the franchisee's failure to meet development obligations, seeking termination of territorial exclusivity and payment of over $4.9 million plus other amounts. The franchisee counterclaimed, alleging Wingstop breached the agreement by rejecting development proposals. The Arbitral Tribunal found the franchisee in breach of development obligations and rejected their counterclaim regarding site rejections. However, the Tribunal determined Wingstop did not validly reduce the franchisee's territory. A final award ordered the franchisee to pay Wingstop over $4.9 million, plus additional currency amounts and interest. The franchisee has filed a petition to set aside this award, which is pending in the Paris Court of Appeal, with a hearing held in March 2025. Other than this case, Wingstop has no other litigation required to be disclosed.
Bankruptcy History
Wingstop Franchising LLC has no bankruptcy history to disclose.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew a Wingstop franchise, franchisees must provide timely notice of their intent to renew (between 90 and 180 days before expiration), sign the then-current franchise agreement and a general release (if allowed by state law), remodel their restaurant's interior and exterior to meet Wingstop's current specifications (regardless of cost), and pay a $25,000 renewal fee. The renewal term is typically 10 years. Franchisees may have the right to a second or third 10-year renewal term if they meet similar conditions, though royalty fees may increase for later renewal terms.
Training & Support Program
Franchisor Assistance
Wingstop provides comprehensive assistance to its franchisees. Before opening, Wingstop helps with site selection guidelines, provides typical restaurant layouts and utility requirements, offers a Lease Rider for negotiations, and furnishes lists of approved inventory and suppliers. Wingstop also provides an initial 3-week training program at its Dallas, Texas headquarters (or other selected locations) for the franchisee or Designated Principal and at least one General Manager. After opening, Wingstop offers help with local publicity and promotions, makes staff available for consultation via phone, email, and intranet, conducts occasional quality/service/cleanliness (QSC) inspections, and arranges for the production and distribution of proprietary sauces and seasonings. Franchisees also receive updates to the Operations Manual, invitations to conventions and seminars, and access to an approved distribution network. Wingstop mandates specific Point-of-Sale (POS) and computer systems, high-speed internet, security camera systems, and phone systems for all restaurants.
Initial Training Hours
175
Training Location
Dallas, Texas
Ongoing Support
After opening, Wingstop franchisees receive ongoing support through various channels. Wingstop staff are accessible for telephone, written, and email consultations, and through the Wingstop Intranet. The company conducts occasional Quality/Service/Cleanliness (QSC) inspections at restaurants and provides updates to the Operations Manual and other confidential information. Wingstop also arranges for the production and distribution of proprietary sauces and seasonings and permits purchases through its approved distribution network. Franchisees are invited to company-sponsored conventions and seminars. For advertising, Wingstop manages an Ad Fund for national and regional campaigns, directs local advertising efforts, and facilitates advertising cooperatives. Franchisees must use Wingstop-specified electronic information systems, including POS, back-of-house hardware/software, and a phone system, with Wingstop having access to sales and operational data. Franchisees are responsible for ongoing maintenance and upgrades to these systems. Wingstop also maintains an internet website for brand promotion and a restricted intranet for franchisee communication.
Franchise Requirements
Ideal Candidate Profile
Wingstop seeks 'qualified individuals' for its franchise opportunities, with multi-Restaurant development rights offered specifically to such candidates. Prospective franchisees are typically required to submit a personal profile and application detailing their personal, financial, business, and other relevant information. For business entities, a 'Designated Principal' from among the owners must be selected to oversee and supervise the restaurant's management and operation. Additionally, a General Manager is required to complete the Wingstop training program and work full-time in the restaurant, and owners (individual or Designated Principal) are strongly recommended to manage the restaurant personally. All individuals with access to confidential information, including General Managers, Assistant Managers, and Principals, must sign confidentiality agreements.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
retail
Owner Participation
supervisory
Territory Type
Protected
Territory Size Requirements
Wingstop's Development Area boundaries depend on the locale's population and demographic features, ranging from a sector of a large metropolitan area to a city or county limits of a smaller municipality. For an individual restaurant, the Trade Area is typically defined by a circle with its center at the restaurant's front door. The radius of this circle varies based on market factors like population density and drive times. Generally, the radius will not exceed 3 miles from the restaurant, or be less than 2 blocks if the restaurant is in a major city's downtown area. These Trade Areas, however, exclude Non-Traditional Venues, where Wingstop retains full rights to operate or franchise.
Staffing Notes
Wingstop requires franchisees to have a General Manager who has completed its training program and works full-time supervising day-to-day operations. If the franchisee (or Designated Principal for a business entity) does not personally manage full-time, then the General Manager and an Assistant Manager must complete training. Franchisees are solely responsible for all employment terms and conditions, including selection, promotion, termination, wages, benefits, and work assignments. Wingstop explicitly states it is not the employer of restaurant staff and requires franchisees to obtain acknowledgments from employees confirming this. All staff must adhere to Wingstop's grooming and dress code standards. General Managers, supervisors, and managerial-level employees with access to confidential information must sign confidentiality agreements. Franchisees are responsible for properly allocating and disbursing tips collected through the Point-of-Sale (POS) system.