Panchero's Franchise FDD, Costs & Fees (2024)

KEY FRANCHISE STATS

All you need to know about this franchise in a snapshot

Initial franchise fee
$30,000
Investment required
$681,000 - $1,388,000
Royalty fee
5.00%

Panchero's: Redefining Freshness in Mexican Fast Casual Dining

Founded in 1992, Panchero's Mexican Grill has become a notable name in the Mexican Fast Casual dining sector, celebrated for its fresh and straightforward approach to Mexican cuisine. With its headquarters in Iowa, Panchero's quickly ingrained itself in the local community, particularly among college students in Iowa City, where the first restaurant was launched.

The brand began franchising in 1995, expanding its unique dining experience to a wider audience. Panchero's distinguishes itself in the competitive fast-casual Mexican market by prioritizing fresh ingredients and offering simple yet high-quality dishes.

A key feature of the Panchero's dining experience is the freshly made, hand-pressed tortillas prepared right before the customers' eyes. This emphasis on freshness and personalization appeals to diners seeking an authentic meal. Additionally, the brand's dedication to simplicity extends to its operations, ensuring efficient and consistent service across all its locations.

Initial investment

Here's what you would need to invest if you were to start this franchise. These costs are provided by the franchisor in the Franchise Disclosure Document.

Type of Expenditure Amount
Initial Franchise Fee $30,000
Real Estate/Rent and Security Deposit $0-$30,000
Utility Security Deposits $0-$5,000
Leasehold Improvements $378,000 - $750,000
Furniture, Fixtures & Equipment $165,000 - $210,000
Initial Merchandise Purchases $2,000 - $5,000
Initial Inventory $8,500 - $15,000
Insurance $3,500 - $17,000
Training $5,000-$15,000
Initial Marketing Campaign $30,000-$50,000
Signage $10,000 - $38,000
Point-of-Sale System (“POS System”) and Back Office Software $13,500-$18,000
Office Equipment/Supplies $3,000 - $7,000
Licenses and Permits $1,000 - $7,500
Professional Fees $6,000 - $40,000
Additional Funds (3 months) $25,000-$150,000
TOTAL $680,500 - $1,387,500

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Number of units

2024
Franchised units

43

47

48

Company-owned units

27

27

26

Total units

70

74

74

Franchise Disclosure Document

Training 

Initial Training: Orientation Within eight weeks of signing the agreement, the managing owner must participate in a three-day orientation program for the first franchised restaurant. All related expenses are the responsibility of the franchisee.

Initial Training: On-The-Job Program Before the grand opening of the first franchised restaurant, the managing owner, designated manager, and any necessary team members must successfully complete an on-the-job training program. The franchisee is responsible for covering all associated costs.

Mandatory Manager Training If new or additional managers are appointed after the initial training, they are required to complete a franchisor-provided training program at the prevailing rates. All costs are to be borne by the franchisee.

Additional Training The franchisor may conduct refresher training programs or seminars that previously trained franchisees, their managers, and/or employees must attend. These sessions, limited to one per year and not exceeding four days, are at the franchisee's expense.

Ongoing Consultation The franchisor offers ongoing consultation and guidance, covering new service and product development, operational and management strategies, advertising and marketing support, and financial and accounting advice. This support may be delivered through visits, meetings, seminars, or electronic communication.

Performance by Delegate Any duties or rights of the franchisor may be executed by designated agents, employees, or representatives. An area director may also provide consultation, advice, services, and support as directed by the franchisor.

Territory Protection

Panchero's provides a form of territorial protection to its franchisees, though it is not absolute or exclusive. Each franchisee is assigned a "Designated Area," which may be defined by factors such as zip code boundaries, county lines, highways, and natural landforms.

Within this Designated Area, Panchero's agrees not to establish or authorize the establishment of another Panchero's restaurant. However, this commitment excludes "Closed Markets." These markets include venues with captive audiences, such as airports, stadiums, military bases, and similar locations, where Panchero's may operate or permit operations regardless of the franchisee's Designated Area.

The scope of territorial protection is limited to preventing the opening of another Panchero's physical location within the Designated Area. It does not confer exclusive sales or service rights within that area. Franchisees may encounter competition from other franchisees, company-owned locations, or alternative distribution channels managed by Panchero's.

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