Background and Benefits
Sonic boasts one of the lowest turnover ratios in quick-service restaurant franchises. Customers can park under a shady canopy and order food through the curbside speakers. A friendly Carhop delivers orders out to the car where patrons can eat it or take it home. The concept cuts down on busy drive through lines and presents a unique eating experience to customers. A standard store layout with 24 to 36 stalls requires approximately ¾ of an acre for build out. Sonic Food is made-to-order with unique menu items not offered at other Quick Service Restaurant's. Sonic maintains strong sales growth, with remarkable customer frequency statistics and continued high returns for stockholders.
The franchise fee is $45,000 with a total investment for a traditional SONIC ranging from $1.1MM to $3.3MM. SONIC is Small Business Administration (SBA) approved. The term of a traditional SONIC franchise is 20 years, plus a 10 year renewal.
Non-traditional franchises start with a 10-year term, a 5-year renewal, and a $22,500 franchise fee. The total initial investment ranges from $434,000 to $545,000, excluding land costs. Other non-traditional locations start with a manageable investment of $107,000 to $221,000. In addition, you must have prior or current successful restaurant experience and/or strong entrepreneurial skills. Sonic offers a 12-week training program that includes eight weeks of restaurant training, three weeks at new store openings and one week of classroom training. *Sonic opportunities are not available in every state.
Pros
* Unit Sales - Average unit sales have increased each year since 1987. * Conceptualized Marketing - The Happy Hour concept drives traffic and sales throughout the system.
Cons
* No One-Hit-Wonders - Sonic only accepting franchisees qualified to open 2 or more drive-ins.

Sonic Drive In Restaurants Franchise Information
Business Established: 1953
Franchising Since: 1956
Franchise Fee: $22,500 to 45,000
Total Investment (US): $107,000 to $3 million depending on store type

Sonic Franchise Process
Qualification/Approval
Attend a Sonic Discovery Day
Development Agreement/Award Franchise
Training Program
Site Selection
Construction
License Agreement

Franchise Offer: Sonic offers the franchisee the opportunity to use its trademarks under the Sonic name, at a single location under the terms of the License Agreement. A Sonic Drive-In typically is a free-standing, one-story building with surrounding parking stalls covered by canopies, providing in-car service for approximately 20 to 36 cars. Many Sonic Drive-ins also incorporate drive-thru service and patio seating, and some may provide indoor seating. 



Financial Assistance: Sonic offers financing to the franchisee for the Sonic Sign package for a 10-year lease term. The franchisor will lease a Sonic sign package at rental rates ranging from approximately $120 per month for a single monument type sign to $790 per month for a large Sonic sign package.



Training and Assistance: Training is provided to the franchisee and at least one individual working full time at the new Sonic Drive-In. This includes up to 150 hours of ‘On-the-job’ training at a Sonic technical training drive-in at various locations throughout the United States, and in the classroom training of a 5 days Sonic Management Seminar. The classroom training is located at Sonic's corporate office in Oklahoma City, Oklahoma.


Territory: Sonic will grant the franchisee the right to operate a Sonic Drive-In either at a specific location or at a location within a specified area subject to Sonic's approval of the specific location within six months after the License Agreement date. Sonic will not own or operate a Sonic Drive-In and will not franchise any other person to own or operate a Sonic Drive-In within the “Protected Area”.



Term of Agreement and Renewal: The length of the franchise agreement is 20 years, with an option to renew for one additional 10-year term.



Obligations and Restrictions: Sonic does not require that the franchisee personally supervise the operation of the Sonic Drive-in. However, at least one individual (usually the manager) working full time at the Sonic Drive-in must attend and successfully complete the Stage Career Development Program and any other training program developed and designated by Sonic from time to time. If the trained individual ceases to work full time at the Sonic Drive-in, the franchisee will have 120 days to replace the individual with someone who has completed the Stage Career Development Program.


Total Number of Units: 2,791 franchised units at the end of 2008.



Financial Statements: Average Net Sales in 2008 totaled $1.15mn, with 44% of franchised units having sales at or above this figure.
Initial Investment: Name of Fee | Low | High | Franchise Fee | $45,000 | $45,000 | Payroll | $72,600 | $89,000 | Training, Travel and Living Expenses while training | $57,000 | $96,000 | Advertising Funds | $7,500 | $22,000 | Opening Inventory | $32,600 | $121,000 | Security deposits, impact fees for utilities, utility deposits, business license and other prepaid expenses | $10,000 | $12,000 | Insurance Premiums | $8,000 | $31,000 | Additional Funds – 3 months | $7,000 | $28,000 | Land | $218,000 | $1,127,000 | Building and Site Work | $525,000 | $1,471,000 | Equipment | $136,000 | $184,000 | Point-of-Sale System | $58,600 | $103,800 | Sonic Sign | $7,000 | $46,000 | LED Electronic Message Center | $25,000 | $38,000 | Total estimated Initial Investment | $1,194,300 | $3,398,800 |

Ongoing Fees: Name of Fee | Amount | Royalty Fee | 2%- 5% of Gross Sales | Brand Fee | 0.75% of Gross Sales | Advertising Cooperative Fee | 3.25% (Minimum) of Gross Sales | Additional Training Fee | $400 per Person | Transfer Fee | $1,500 | Audit Fee and Surcharge | Cost of Audit plus 10% of unpaid amounts | Late Charge | 1.75% of Amount Overdue | Renewal Fee | $6,000 |

Franchise Units YEAR | U.S. | CANADIAN | INTERNATIONAL | COMPANY OWNED | 2013 | 3,126 | 0 | 0 | 408 | 2012 | 3,005 | 0 | 0 | 438 | 2011 | 3,079 | 0 | 0 | 446 | 2010 | 3,103 | 0 | 0 | 458 | 2009 | 3,055 | 0 | 0 | 481 |
Where Seeking Franchisees: Franchisor is seeking new franchise units throughout the U.S.
Startup Costs, Ongoing Fees and Financing
Total Investment: $1,112,300 - $3,246,200
Franchise Fee: $45,000
Ongoing Royalty Fee: 2-5%
Term of Franchise Agreement: 20 years, renewable
FINANCIAL REQUIREMENTS
Net Worth: $1,000,000
Liquid Cash Available: $1,000,000
OPERATIONS
60% of all franchisees own more than one unit. Number of employees needed to run franchised unit: 25. Absentee ownership of franchise is NOT allowed.. FINANCING TYPE | IN-HOUSE | THIRD PARTY | Franchise Fee | | | Startup Costs | | | Equipment | | | Inventory | | | Accounts Receivable | | | Payroll | | |