About Del Taco Franchise
Del Taco is a quick service restaurant franchise known for its menu of Mexican inspired favorites and American classics, including tacos, burritos, quesadillas, burgers, and fries.
The brand has been franchising since 1990 and is now part of the Jack in the Box Inc.
family of restaurant brands, giving it additional corporate resources and industry expertise.
Del Taco Franchise Cost & Fees
Minimum Investment
$813K
Average Investment
$1.6M
Maximum Investment
$2.5M
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $35,000 | One-time payment upon signing |
| Royalty Fee | 5% of net sales of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | 4% of net sales | National brand fund |
| Total Investment Range | $812,700 – $2,467,500 | Includes build-out, inventory, working capital |
The investment range of $813K–$2.5M reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (5% of net sales) and marketing fee (4% of net sales) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Franchise Fee | $35,000 | $35,000 |
| Promotional Fee | $10,000 | $10,000 |
| Professional Fees | $0 | $55,000 |
| Lease Payment | $0 | $25,000 |
| Building | $400,000 | $800,000 |
| Site Work and Entitlement | $50,000 | $450,000 |
| Architectural, Engineer and Utility Fees and Costs | $25,000 | $200,000 |
| Furnishings, Fixtures and Equipment (“Supplies”) | $400,000 | $575,000 |
| Computer Systems | $58,000 | $80,000 |
| Technical Support | $1,700 | $3,500 |
| Insurance | $8,000 | $20,000 |
| Initial Training | $15,000 | $25,000 |
| Crew Training | $48,000 | $68,000 |
| Working Capital | $20,000 | $45,000 |
| Inventory | $7,000 | $7,000 |
| Licenses, Fees and Deposits | $3,000 | $6,000 |
| Trade Area Survey Analysis | $0 | $10,500 |
| Business Impact Payment | $0 | $52,500 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | At least $5,000 per Restaurant and possibly more in order to cover our costs of review and approval, including attorney fees |
| Renewal Fee | Greater of $35,000 or the then-current initial franchise fee for new franchisees, plus the then-current Promotional Fee (currently $10,000) |
| Technology Fee | $40 per week |
| Audit Fee | Will not exceed our actual out-of-pocket costs (currently about $1,000 to $2,000) |
| Ceridian Dayforce | $21.92 per week $225 per year annual $1,740 one-time payment for Ceridian clock |
| Del U E-Learning | $5.00 per week |
| Store Audit Reinspection Fee | $500 per reinspection |
| Interest | 7 percentage points in excess of the prime rate per annum as published in The Wall Street Journal |
| Indemnification Costs | Varies |
| New Product and Vendor Testing | Will not exceed our actual out-of-pocket costs (currently about $2,000 to $3,000) |
| Reimbursement of Insurance | Cost of obtaining coverage |
| Extension Fee (Development Agreement) | $5,000 per deadline to be executed |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | 5-week in-Restaurant training program for managers, 2-week training program for crew |
| Classroom Training | 40 |
| On-the-Job Training | 400 |
| Training Location | Certified Training Restaurant |
| Additional Training | Virtual management training courses for shift managers and above. Two-Day Overview for investors holding 20% or more interest (one day in restaurant, one day at HQ). |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Protected |
| Exclusive Territory | No |
| Territory Size | all of the circular area within a one-mile radius from the front door of your Del Taco Restaurant, excluding Alternative Points of Distribution |
| Description | The Franchise Agreement grants the right to operate at a single approved location with a protected area of a one-mile radius, excluding Alternative Points of Distribution (e.g., military bases, college campuses, airports, large retail outlets, etc.). The franchisor retains rights to operate or license others to operate Del Taco restaurants outside this protected area, and to operate or license co-branded/multi-branded restaurants or other businesses within or outside the protected area. The franchisor also retains rights to sell collateral products through various channels. Development Agreements grant exclusive rights to develop restaurants within a defined geographic Development Area, but this does not preclude the franchisor from operating Alternative Points of Distribution within that area. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 20 years |
| Renewal Term | 1 additional term, which shall be the lesser of (a) twenty (20) years or (b) the remaining term of the lease for the Restaurant premises. |
| Renewal Fee | Greater of $35,000 or the then-current initial franchise fee for new franchisees, plus the then-current Promotional Fee (currently $10,000) |
| Renewal Conditions | No default may exist under the existing agreement. Provide notice of renewal at least 12 months in advance. Required to sign a new Franchise Agreement (which may increase fees), sign a general release, meet all monetary obligations, and pay a Renewal Fee and Promotional Fee. May be required to remodel the Restaurant (capped at $250,000 indexed to CPI) and complete additional training. |
| Transfer Fee | At least $5,000 per Restaurant and possibly more in order to cover our costs of review and approval, including attorney fees |
| Transfer Conditions | We have the right to approve all transfers; we will not withhold our consent unreasonably. No default may exist and you pay all amounts due and sign a general release; the transferee must complete our training and meet all of our other requirements, sign our then-current form of franchise agreement, and pay a transfer fee. |
| Termination for Cause | We may terminate upon default. Defaults include failure to cure operational defaults within 30 days, monetary defaults within 5 days. Non-curable defaults include danger to health or safety, bankruptcy, assignment for the benefit of creditors, felony conviction, repeated violations, execution of levy not discharged within five days, attachment of property, and unsatisfied final judgments of $10,000 or more for 30 days or longer, and default under any other agreement. |
| Non-Compete Period | 2 years |
| Non-Compete Details | During the term of the franchise, you cannot use the Del Taco System or any other names, marks, systems, logotypes, symbols or foodstuffs provided by us or an approved supplier in connection with another Restaurant; you cannot operate any 'competitive business' (a restaurant or food service business offering Mexican or similar style menu items in a quick service, fast food, or fast casual format) within two miles of your original location or any other existing Del Taco Restaurant. After termination or expiration, for two years, you cannot operate a competitive business within two miles of your original location or any other existing Del Taco Restaurant. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | Yes |
| Participation Details | If you operate as a legal entity, someone affiliated with your organization and approved by us must participate personally in the operations. Your designated Operating Principal and you must attend and satisfactorily complete the initial training program. The person responsible for direct operation must have at least two years of quick service Restaurant management experience (for a single unit) or five years (for a multi-unit franchisee), and an equity interest of at least 10% in the business. Owners are required to execute a personal guaranty. |
| Required Suppliers | You must purchase all goods, products, menu items, foodstuffs, beverages, packaging materials, signage, furniture, fixtures, equipment, computer hardware and software, and small wares (“Supplies”) used to operate or furnish your Del Taco Restaurant from vendors who demonstrate the ability to meet our standards and specifications and whom we have approved in writing. You must engage the services of PCI compliance vendors to provide the services that we designate. We have engaged NuArx to provide PCI compliance services. You must use such related computer hardware and/or software that we may designate or approve. You must also use an Internet service provider of whom we have approved. You must also purchase customer relationship management services and software, for which we or our affiliates may be the only approved supplier. You must purchase most of your Supplies through McLane Corporation. You must purchase beverages under an existing beverage marketing agreement with the Coca-Cola Company. |
| Supply Restrictions | We expressly reserve the right to modify our standards and specifications from time to time. If you desire to purchase any Supplies from a vendor not already approved, you must obtain our prior written approval, which may take up to 90 days. As a condition to granting approval, we may require you to submit samples and arrange for facility visits. You must obtain and maintain at your own expense insurance policies with insurers reasonably satisfactory to us. If you decide to lease the land, certain provisions must be included in the lease relating to use, default, notices, lien waivers, length of term, assignment, remodeling, personal property rights, franchisor entry rights, protection of proprietary marks, and non-competition by the landlord. |
| Franchisor Revenue from Suppliers | During our fiscal year ended October 2, 2022, we occasionally purchased computer-related hardware and equipment from third-party vendors on behalf of franchisees and resold such hardware and equipment to franchisees at no markup; that is, we received reimbursements for the cost of computer-related hardware or equipment purchased on behalf of franchisees. Except for such reimbursements, neither we nor our affiliates received any payments from our franchisees as a result of any required purchases or leases covered by this Item 8. During our fiscal year ended October 2, 2022 we received rebates from one vendor based on purchases by our franchisees totaling approximately 11.3% of the purchases involved. Although we are not required by the Franchise Agreement to do so, we used those funds (directly or through the advertising fund) to help pay for system-wide promotions. |
Del Taco Franchise Earnings — Item 19
Average Revenue
$1.6M
Median Revenue
$1.5M
Revenue Range
$512K – $5.7M
Sample Size
278 units
Past financial performance does not guarantee future results. Individual results will vary.
Del Taco Litigation & Risk Flags
4 Pending Actions ListedReview the full FDD for details on pending litigation.
Bankruptcy History DisclosedA bankruptcy disclosure is present in this FDD.
Litigation and bankruptcy data is sourced from Items 3 and 4 of the FDD. Always verify current status directly from the most recent FDD.
Del Taco System Growth
Total Units
591
Franchised
301
Company-Owned
290
Del Taco currently operates 301 franchised locations and 290 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2020 | 16 | 16 | 596 |
| 2021 | 13 | 9 | 600 |
| 2022 | 1 | 10 | 591 |
Transfers: 4 | Closures: 10
State Registrations
Registered in 23 states: CA, FL, HI, IL, IN, MD, MI, MN, NY, ND, RI, SD, UT, VA, WA, WI, AZ, CO, DE, GA, NV, OK, TX
Franchisor Financials (Item 21)
Revenue
$1468.1M
Net Income
$115.8M
Total Assets
$2922.5M
Audited by KPMG LLP for year ending October 2, 2022.
Del Taco Franchise — FAQ
The total investment to open a Del Taco franchise ranges from $812,700 to $2,467,500, per their Franchise Disclosure Document. This includes the initial franchise fee of $35,000. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
Del Taco charges a royalty fee of 5% of net sales of gross sales, plus a 4% of net sales contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the Del Taco Franchise Disclosure Document free on this page. The FDD is a public document filed with state franchise registries. Always also request the current FDD directly from Del Taco to ensure you have the most up-to-date version.
According to the Item 19 financial performance representation in their FDD, Del Taco franchise owners report average revenue of $1.6M and median revenue of $1.5M. This is based on a sample of 278 units. Past performance does not guarantee future results.
Del Taco has been franchising since 1990. The FDD shows an investment range of $812,700-$2,467,500, a 5% of net sales royalty, and includes an Item 19 earnings disclosure. There are 4 pending litigation action(s). Review the full FDD and contact current franchisees listed in Item 20 before making any investment decision.
The franchise fee is $35,000 and the total investment ranges from $812,700 to $2,467,500 depending on location size and market. Contact the franchisor directly for current net worth and liquid capital requirements, territory availability, and application details.
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Data Source & Disclaimer: This website is for informational purposes only. It is not an offer to sell or buy a franchise. This profile is based on publicly available FDD data sourced from state franchise registry filings. All information is for research purposes only and does not constitute legal, financial, or investment advice. Data may be outdated or contain errors. Always obtain the current FDD directly from Del Taco and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with Del Taco or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com