Americans eat 20 billion hot dogs a year, or roughly 70 per person. That explains why hot dog franchises are popular.
What does that mean when you’re thinking about buying a franchise?
Let’s look at some stats about hot dogs. In other words, who’s eating the hot dogs, and where are they eating them?
- 45% sold in retail stores
- 21% eaten in restaurants
- 15% purchased from street vendors
- 10% eaten at festivals and events
- 9% eaten at ballparks and sports arenas
Well, that is certainly food for thought. Hot dogs have long been a quick-meal staple in many homes.
As a franchisee, you can own a cart, a space in a store or a storefront. As food franchises go, hot dog franchises are comparatively simple, and many franchisees go on to own multiple locations. This type of franchise has relatively low costs because there is very little waste. Uncooked food goes back into refrigeration, where it has a long shelf life.
Choosing the Perfect Hot Dog Franchise: Our Methodology
From the iconic New York-style dog to gourmet creations, the hot dog industry is sizzling with opportunity. But how do you choose the right hot dog franchise that suits your entrepreneurial aspirations? We’ve ranked these criteria on a scale of importance, using a 1-10 rating scale, with 10 being the highest importance and 1 being the lowest:
Taste and Quality of Hot Dogs (Rating: 10/10): The taste and quality of hot dogs should be exceptional, earning it the highest rating as it’s the core of your business.
Brand Reputation and Recognition (Rating: 9/10): A well-established and recognized brand is crucial. It’s slightly below taste and quality because both factors often go hand in hand.
Location and Foot Traffic (Rating: 9/10): The right location with high foot traffic is essential for success. It’s equally crucial as brand reputation.
Menu Variety and Customization (Rating: 7/10): A diverse menu with customization options is valuable but ranks lower than core elements.
Franchise Fees and Costs (Rating: 7/10): The financial aspect is important, but it’s not as vital as taste, location, and brand.
Marketing and Advertising Support (Rating: 6/10): Effective marketing is important but falls just below the top priorities.
Supplier Relationships (Rating: 6/10): Reliable suppliers are significant but slightly less crucial than core factors.
Training and Support (Rating: 4/10): Comprehensive training and support from the franchisor are essential but not as high-priority as core elements.
Equipment and Technology (Rating: 4/10): Proper equipment and technology matter but rank lower in importance compared to others.
Community Involvement (Rating: 3/10): Engaging with the local community is beneficial but not as critical as core elements.
Hot Dog Franchise Opportunities
Want to learn more about just how hot the opportunities are? Here are the top hot dog franchise opportunities:
1. Nathan’s Famous Inc. Franchises
In 1916, Polish immigrant Nathan Handwerker borrowed $300 to set up a hot dog cart on Coney Island. Faster than you could squirt a squiggle of mustard, the hot dog transformed into a profitable venture.
Nathan’s Famous annually holds a hot dog eating contest in Coney Island on the corner where Handwerker set up his cart – the corner of Stillwell and Surf. The company went public in 1970 and began to offer franchise opportunities in 1988 and it’s still in the top 5 of hot dog franchise businesses. The stalwart of Nathan’s is its World Famous Beef Hot Dog.
The franchise fee is $30,000, and royalties (based on gross sales) are 5.5%.
2. Wienerschnitzel Franchises
Wienerschnitzel has a number of specialty dogs, including Junkyard Dogs (hot dogs covered in fries, chili sauce, cheese, French’s mustard and grilled onions). In addition to dogs, Wienerschnitzel offers breakfast, and also burgers and sandwiches. The dogs are all beef or Polish sausage. The company began offering franchise opportunities in 1961.
The franchise fee ranges from $10,000 to $32,000, with a royalty fee of 5.5%.
3. Hot Dog on a Stick Franchises
The featured hot dog is just what the name implies. In the 1940s, a man named Dave Banham took a hot dog and improvised. Instead of using a bun, he used his mother’s cornbread recipe to cook a dog covering.
Hot Dog on a Stick has added other food, such as cheese on a stick and funnel cake sticks. It’s all good stick to your ribs food.
The franchise fee ranges from $15,000 to $25,000, with a royalty fee of 5%.
4. Dog Haus Worldwide Franchises
Dog Haus specializes in gourmet hot dogs. If you don’t think there can be such a thing, consider the Free Bird hot dog. The Free Bird is a turkey dog, with toppings of avocado, tomato and smoked bacon, covered in a sauce of miso ranch.
Franchising opportunities have been offered since 2010. The franchise fee is $35,000 with a 6% royalty.
5. Sonic Drive In Franchises
Sonic Drive In adds a taste of nostalgia with its signature carhops service. This Top 5 in the dog franchises offers lots of other food, such as burgers and shakes.
There are 5 dogs that are popular at Sonic: the AllAmerican , the New York, the Chili Cheese Coney, the Footlong Chili Cheese Coney and the Corn Dog. Sonic has a big menu with many offerings and also appears on our list of burger franchises.
Sonic has been offering franchise opportunities since 1953. To get started with the company you’ll need a $45,000 franchise fee and a 5% royalty.
6. Dave’s the Dog House LLC Franchises
You know Howard Johnson’s as the hotel and restaurant with the orange roof. Well, Howard Johnson, yes, that Howard Johnson, started Dave’s the Dog House in Boston before moving on to the company hotel and restaurant success.
It was Howard Johnson who got the idea of the hand-made special buns. The buns are cut from a loaf, with a cut in the center of that cut, making a nest for the dog.
The franchise fee is $25,000 with a royalty of 6.5%.
7. Umai Savory Hot Dogs Franchises
Umai Savory Hot Dogs has a specialty menu and hot dogs are a part of it. The dogs are made from premium meat, with natural casings and fresh ingredients. There is no MSG, no by-products, no colors and no fillers. The dogs are also gluten-free.
The restrictions on fresh ingredients doesn’t limit the types of hot dogs. There are 11 kinds of meat, 27 flavors and 20 sauces.
The franchise fee is $20,000 and royalties are 5%.
8. Dat Dog Specialty Franchises
Although this company is based in New Orleans, the franchise opportunity is nationwide. The Dat Dog franchises, wherever they are, will feature local beers and wee hours operations.
Gourmet sausages include alligator, crawfish and duck. There are also vegetarian food offerings and choices of 30 toppings on the dogs.
The franchise fee is $50,000 and the royalty is 6.5%.
9.The Original Hot Dog Factory Franchises
The Original Hot Dog Factory and a variety of other foods, such as desserts and beverages. Its original hot dogs may be steamed, grilled or fried.
The franchise fee is $20,000 and the royalty is 5.5%.
10. Destination Dogs Franchises
Destination Dogs offers gourmet dogs and sausages, with a slant based on global travel. Each of the Destination Dogs hot dog franchises has a theme, based on the area where it’s located. The franchises also offer specialty cocktails, all with an eye to appeal to global travelers.
The franchise fee is $50,000 and the royalty is 6%,
11. Sam’s Hot Dog Stand Franchises
Sam’s is unique in hot dog franchises as it keeps a watchdog eye on its specialty chili sauce. Sam’s Hot Dog Stand started in West Virginia, and its secret sauce dates back to the 1960s.
As a franchise opportunity, it’s low cost with a franchise fee of $10,000.
See other franchises under $10K.
12. What’s Up Dog? Franchises
This business offers several options for franchises, from brick and mortar to trailer and carts, and even to a new, mini-concession vehicle. Are mobile dogs the new way of the future in hot dog franchises?
What’s Up Dog? offers an 8-inch, all-beef dog, also chili, cheese, and corn dogs.
Currently the fee is $25,000, and royalty is 5%. The company also offers a licensing arrangement in lieu of a franchise.
13. Crave Hot Dogs & BBQ Franchises
In addition to the traditional all-beef, Crave offers brats and sausages. All are grilled. Additional food is available with a variety of side dishes on the menu.
Crave has also added a new food truck franchise option. The fee for the franchise is $40,000.
14. Hula Dog Franchises
Hula Dog is unique among franchises in the way the food is presented. A hole (puka) is toasted into bread, and the bread is then snugged around the hot dog. The bread goes around the product, like a hula hoop.
The business is themed, with a setting like a bamboo hut. Condiments feature tropical fruits and sauces, such as Mango relish. The fee is $25,000.
15. Windmill Hot Dogs Franchises
Windmill franchises are based in New Jersey and expanding to other states. The franchises must use local butchers as the source, including char-broiled chicken breasts and custom rib eye steaks.
The fee for the franchise is $25,000 with a royalty of 5%.
Hot Dog Franchise or Independent Operation: Making Your Choice
- Independence vs. Franchise: Before diving into the world of hot dogs, consider whether you want to join an established franchise or venture out independently. Each path has its own merits:
- Franchise Pros:
- Benefit from a recognized brand and customer base.
- Access to proven business models and support.
- Marketing and advertising assistance.
- Established supplier relationships.
- Franchise Cons:
- Franchise fees and royalties.
- Limited flexibility in decision-making.
- Adherence to franchise standards.
- Independent Pros:
- Complete creative control over your brand and menu.
- No franchise fees or royalties.
- Ability to pivot quickly in response to market trends.
- Independent Cons:
- Building brand recognition from scratch.
- Higher initial risks and uncertainties.
- Potential for increased workload in sourcing suppliers and marketing.
- Franchise Pros:
- Market Research and Location: Regardless of your choice, conducting thorough market research and selecting the right location is pivotal to your success. Here’s what to consider:
- Analyze local demographics to understand your target audience.
- Scout locations with high foot traffic, such as busy streets, malls, or entertainment areas.
- Evaluate competition in the vicinity and identify gaps you can fill.
- Consider local permits and regulations for food vendors.
- Calculate the cost of rent and utilities to ensure profitability.
- Menu Innovation and Signature Offerings: Setting your hot dog business apart requires innovation and unique offerings:
- Experiment with creative hot dog toppings and flavors.
- Offer signature creations that become customer favorites.
- Consider complementary menu items like sides, beverages, or desserts to enhance the dining experience.
- Embrace dietary trends, such as vegetarian or vegan options, to cater to a broader audience.
- Quality Ingredients and Suppliers: Whether you opt for a franchise or independent operation, prioritize the sourcing of high-quality ingredients:
- Build relationships with trusted local suppliers for fresh produce and meats.
- Prioritize suppliers that align with your commitment to quality and sustainability.
- Consistency in ingredient quality is key to maintaining customer satisfaction.
- Customer Engagement and Feedback: Engaging with your customers and gathering feedback is a continuous process:
- Implement customer feedback mechanisms, both online and offline.
- Actively listen to customer preferences and adapt your menu or service accordingly.
- Foster a welcoming and friendly atmosphere to encourage repeat business.
- Consider loyalty programs or special promotions to reward regular customers.
- Legal and Health Compliance: Ensure that you meet all legal and health requirements for operating a food business:
- Obtain the necessary licenses and permits for your location.
- Maintain strict hygiene and food safety standards.
- Comply with health inspections and regulations to safeguard your customers’ well-being.
- Stay informed about any changes in food safety guidelines and adapt as needed.
|Independence vs. Franchise||– Benefit from a recognized brand. – Access to proven business models and support. – Marketing and advertising assistance. – Established supplier relationships.||– Complete creative control over your brand and menu. – No franchise fees or royalties. – Ability to pivot quickly in response to market trends.|
|Market Research and Location||– Franchise’s market research support. – Assistance in selecting high-traffic locations. – Leverage the franchise’s reputation.||– Independent market research required. – Full control over location selection. – Building your brand’s reputation from scratch.|
|Menu Innovation and Signature Offerings||– May follow established franchise menu. – Limited innovation within franchise guidelines.||– Full creative freedom to innovate. – Create unique and signature offerings. – Experiment with diverse menu items.|
|Quality Ingredients and Suppliers||– Benefit from the franchise’s supplier relationships. – Adherence to franchise quality standards.||– Directly source ingredients, potentially locally. – Control ingredient quality and sustainability.|
|Customer Engagement and Feedback||– Access to established customer base. – Franchise may have loyalty programs. – Feedback channels may be provided by the franchise.||– Build a customer base from scratch. – Implement and manage your feedback mechanisms. – Personalized customer engagement.|
|Legal and Health Compliance||– Typically, franchise provides guidance on legal and health compliance. – Adherence to franchise standards.||– Independent compliance research and execution. – Strict adherence to local health and safety regulations.|
How much does it cost to start a hot dog franchise?
The typical fee for a hot dog franchise ranges from $20,000 to $50,000. The initial investment, which includes startup costs, inventory, real estate and other fees, can range from $25,000 to $1 million. The franchises come in a wide variety, from small niches within other businesses to stand-alone brick and mortar. That’s why the initial investment can vary so greatly.
What does your investment go toward? You are paying the franchisor to provide training, support, and a proven system with information about how to be successful.
How much can you make owning a hot dog business?
Let’s start by taking a look at the profit margins on the star attraction. According to research compiled by LearnHotDogs.com, the average cost for a dog, with condiments, is about 40 cents. If you look at the cost for a dog with multiple toppings or loaded, the cost for the business is about 80 cents. These prices vary by the quality of ingredients, everything from the frank to the bun and condiments.
What can you charge for a hot dog and make a profit? For a hot dog just with condiments, that’s about $2. But it’s not that simple, since the difference between cost and sales price isn’t all profit. There’s the cost of utilities and insurance, as well as a mortgage and employees if that applies. There is the cost to purchase inventory and cooking and cleaning equipment.
With all that said, there’s definitely some profit in selling hot dogs. But since your price points are lower, you have to sell higher volumes to reach a sustainable income.
How do I start a hot dog business?
What if you wanted to start a business on your own, without going the franchise route? Just outfit a small cart and sell? There are a number of hurdles to overcome before doing so:
Check legal requirements, also local health requirements. You will also need a local permit. Even a food cart must have both a hot and cold water source in most cases. Licenses and permits typically cost about $500.
Expect to spend at least $3,000 on cooking equipment as a minimum. The total cost will most likely be closer to $20,000. You’ll need another $1,500 for inventory, including napkins and paper products. You’ll also need a cash register or point of sale system, with an estimated cost of about $1,000.
To sum up, before you open you’ll spend from $5,000 to $30,000. Once you’re in operation, you’ll spend $800 to $3,000 monthly to restock and renew inventory.
But, that’s a good thing. If you don’t need to restock and renew, you aren’t selling!
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