Hooters is the creator of the breastaurant. Yep, you read that correctly. A breastaurant is a restaurant with well endowed female servers dressed in sexy clothing and Hooters is recognized as the first in the niche industry. And yes, Hooters is actively seeking new franchisees to expand their brand.

How much does it cost to open Hooters? To start, you’ll need a liquid capital of $1.5 million and a net worth of $2.5 million. The initial investment to start a Hooters franchise is $2.2 million to $4.2 million and the franchise fee is $75,000.

But there are warning signs you need to be aware of before you invest. Like did you know the number of Hooters locations has declined from more than 400 restaurants to about 300? In this review, I evaluate the fees, profitability, and risks of this chain. Click here to take our 7-minute franchise quiz and get matched with a growing opportunity.

Financial Requirements and Fees

The following below are the financial requirements and fees to expect when you want to franchise Hooters.

In addition, there is a royalty fee of 5% and a national advertising fee of 2.5% although these fees vary by country if you plan to franchise internationally.

United States military veterans can get a 10% discount off the franchise fee.

The initial franchise term for a Hooters restaurant is 20 years and the renewal term is 10 years.

Average Sales / Revenue per Year

According to reports, Hooters’ U.S.A. revenue for the year 2022 amounted to $835 million. This is considered an increase in their 2021 sales of $605 million.

Hooters Franchise Facts

Hooters was conceptualized back in 1983 by L.D. Stewart, Gil DiGiannantonio, “Uncle Billy” Ranieri, Ed Droste, Dennis Johnson, and Ken Wimmer. They called themselves and are known in Hooters history as the Hooters Six. The business has gone through different ownership and management through time. At present, Hooters is owned by Nord Bay Capital and TriArtisan Capital Advisors.

Hooters is a sports bar and a breastaurant and considered the first in the industry. They’re known for their Hooters Girls which are waitresses dressed in minimal and skimpy clothing.

International Women’s Day post from Hooters.

In addition to their Hooters Girls, the sports bar is also known for their menu which includes appetizers like their Fried Pickles and Cheese Sticks, burgers, seafood, sandwiches, salads, tacos, sides, sauces, and most of all, their wings which come in different flavors.

To franchise Hooters, fill up the request form online located here. Once submitted, Hooters’ Franchise Team representative will contact you to discuss more about your interest in franchising with them. A formal application form will be handed after discussions are made.

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Once your application is reviewed, a Market Development Director for the region will meet with you to discuss more about franchising Hooters. This process will include showing of additional documents and filling up more forms. Afterwards, you’ll be able to speak with existing franchisees to know more about Hooters.

You’ll also be invited to Hooters’ Corporate Headquarters for Discovery Day. At this event, you’ll meet key personnel for Marketing, Operations, Construction, Design, Franchise Development, Legal, and Finance. Afterward, when you’ve finally decided to seal the deal, your request to franchise will go through an approval process. Once approved, you’ll get to sign the Franchise or Development Agreement for your very own Hooters.

The Trade Area Demographics for a Hooters location is as follows:

• Minimum population of 100,000 population in the immediate trade area surrounding the site
• Daytime population of at least 15,000 in the immediate trade area
• Median income of $50,000 and higher in the trade area

The site requirements are the following:

• Lot size of 1.5 acres or larger unless parking can be shared with adjoining lots
• Minimum building size of 5,000 square feet
• Minimum of 80 parking stalls
• Superior visibility of the building and signage elements
• Easy accessibility into location, with a preference for two curb cuts at a signalized corner
• Traffic count of at least 30,000 VPD
• Superior strategic positioning of the site for the trade area
• Strong retail synergy within ½ mile of the location
• Late-night activity drivers within one mile of the site
• Ability to achieve Hooters brand signage and exterior elements

The present CEO and President of Hooters of America is Sal Melilli. Hooters’ headquarters is located at Atlanta, Georgia.

How Much Does Hooters Make in Profit?

According to an estimate, if you spent an initial investment of $3,265,750, an average of a 15% profit margin can get you $413,366 but it will take you 9.5 years to earn back your investment. This is considered a long period of time to wait before getting your initial investment back.

How much does the average Hooters store generate in revenue per year?

The typical Hooters location generates roughly $1 million in revenue per year. Here are the top selling menu items at Hooters that account for 70% of sales on average for these restaurants and the breakdown of the revenue generated by each menu item:

Wings: $175,000 (25% of sales)
Sandwiches: $150,000 (20% of sales)
Salads: $105,000 (15% of sales)
Appetizers: $70,000 (10% of sales)
Drinks: $70,000 (10% of sales)

Wings are the top selling menu item at Hooters.

It is important to note that these are just estimates and that the actual revenue generated by each menu item varies depending on the location of the restaurant and the time of year. I’m surprised the restaurant does not do a larger amount of sales on alcoholic drinks like beer or cocktails. I think this is an opportunity for the restaurant chain to promote these higher profit beverage sales.

How much does the average franchise owner make with Hooters?

The FDD also states 51% of Hooters franchise owners earn less than $50,000 per year. This means that the majority of Hooters franchise owners are not making a lot of money. If you wanted to fully support your lifestyle, many entrepreneurs would need 2 – 3 locations to cover their expenses.

The average franchise owner of a Hooters restaurant makes an average of $100,000 per year, according to the FDD. However, it is important to note that this is just an average and that the actual income of a franchise owner can vary significantly. Some franchise owners may make much more than $100,000 per year, while others may make much less.

Advantages of a Hooters Franchise

Franchising Hooters can bring about a couple of advantages. Below are the following you can look forward to:

Family Restaurant

Hooters is an iconic sports bar in the breastaurant scene. But that doesn’t mean you can’t bring the kids. In fact, they’ve even got a kids menu for children 12 and under to enjoy. Just look at this happy family below as an example.

Dining at Hooters.

Incentives

Hooters has been around for 40 years and they’re trying to get back on the road to unit expansion. To celebrate their 40th year in business, Hooters is offering 40 weeks of free royalties for new Hooters store franchises this year. Such an offer can greatly help new franchises save on the ongoing expenses that a 5% royalty fee brings.

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Hooters’ new franchising strategy also includes lower investments, simpler kitchen operations, and conversion plans for a second generation space. These promotions are made in an effort to attract new franchisees.

Legacy and Global Name

Hooters is a name that’s well known not just in the United States of America but all around the world such as in China, Brazil, Canada, Indonesia, Japan, South Africa, and more. They’re also adapting to the times by upgrading their menu and design but also keeping the classic Hooters hospitality.

Challenges of a Hooters Franchise

Franchising Hooters can pose some challenges. Here are a few that you should be aware of.

Locations Closing

From what used to be more than 400 locations, Hooters is now down to around 300. This could be because of a lack of interest by millenials for breast-related content which is Hooters has relied on for so many decades. But the closure of these restaurants can also be blamed from the lack of sales. Hooters in international locations such as Bristol, Japan, and the Philippines have had their restaurants closed down and it looks like the company is having trouble attracting new franchisees.

Confusing Ownership

Hooters is known to be divided into two entities: Hooters of America and Original Hooters. Though there hasn’t been a clear and official explanation for this, one user on Facebook commented how Hooters of America runs most of the operations you see in the United States of America except for Chicago and the Atlantic coast which is run by Original Hooters.

Lawsuits and Sexual Harassments

Hooters has faced numerous sexual harassment charges and other lawsuits through the years. Waitresses have sued Hooters for being biased about weight, for under-compensation, for being discriminatory in their hiring process, for being racist, and so on. That’s a long list of legal accusations and it has damaged Hooters reputation among certain demographics. Be aware of some of these legal challenges before you decide to franchise with the company.

This could be your scenery at work.

Is the Hooters Franchise Right For You?

If Hooters is a concept that you believe might work in your area and is something you can afford to franchise then it may be the right franchise for you. As long as you are aware of the challenges and advantages of the restaurant chain, you can weigh the pros and cons of investment.

What is an alternative Hooters franchise?

A similar concept to Hooters is called Twin Peaks. They’re also a sports bar that serves an elevated menu that is served by their very own Twin Peaks girls that wear revealing clothing.

To franchise Twin Peaks, expect the investments to be around $1,520,800 to $5,106,500 with a franchise fee of $50,000. To learn more about Twin Peaks, read my full franchise review here.

Franchising a restaurant comes with a lot of advantages and challenges. May this guide in franchising Hooters be able to help you in your future franchise venture.