About Texas Roadhouse Franchise
Texas Roadhouse is a full service casual dining franchise celebrated for its hand cut steaks, made from scratch sides, and freshly baked bread rolls served with cinnamon butter.
The brand has been franchising since 1995 under Texas Roadhouse, Inc.
(TXRH), a publicly traded company, and has grown into one of the most successful steakhouse chains in the United States.
Texas Roadhouse Franchise Cost & Fees
Minimum Investment
$4.3M
Average Investment
$5.6M
Maximum Investment
$6.8M
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $40,000 | One-time payment upon signing |
| Royalty Fee | 4% of Royalty Sales of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | Current: 0.3% of Royalty Sales; Maximum: 2.5% of Royalty Sales (Marketing Fund). 2% of Royalty Sales (Local Marketing). 2% of Royalty Sales (Cooperative Marketing). Total required marketing contributions or payments will not exceed 3% of Royalty Sales. | National brand fund |
| Total Investment Range | $4,349,500 – $6,801,500 | Includes build-out, inventory, working capital |
The investment range of $4.3M–$6.8M reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (4% of Royalty Sales) and marketing fee (Current: 0.3% of Royalty Sales; Maximum: 2.5% of Royalty Sales (Marketing Fund). 2% of Royalty Sales (Local Marketing). 2% of Royalty Sales (Cooperative Marketing). Total required marketing contributions or payments will not exceed 3% of Royalty Sales.) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Franchise Fee (1) | $40,000 | $40,000 |
| Leasehold/Building Improvements (2) | $1,900,000 | $2,600,000 |
| Architectural/Engineering/Site Evaluation (3) | $150,000 | $225,000 |
| Builders Risk and OCP Insurance | $5,000 | $12,000 |
| Performance Bonds (4) | $14,000 | $38,000 |
| Furniture, Decor and Fixtures (5) | $270,000 | $320,000 |
| Equipment (6) | $900,000 | $1,100,000 |
| Signs (7) | $50,000 | $180,000 |
| Insurance (8) | $48,000 | $100,000 |
| Initial Inventory (9) | $38,500 | $62,000 |
| Supplies (10) | $20,000 | $35,000 |
| Smallwares (11) | $20,000 | $60,000 |
| Computer Hardware/Software; POS System/Network Cabling Fees (12) | $200,000 | $250,000 |
| Marketing and Promotional Materials (13) | $1,000 | $10,000 |
| Training Costs/Opening Assistance (14) | $90,000 | $139,500 |
| Licenses, Permits, Incorporation (15) | $25,000 | $225,000 |
| Liquor Licenses (16) | $1,000 | $300,000 |
| Utility and Telephone Deposits (17) | $5,000 | $50,000 |
| Other Pre-opening Costs Not Listed Above (18) | $130,000 | $255,000 |
| Additional Funds (3 months) (19) | $442,000 | $800,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | $3,500 or any greater amount necessary to reimburse us for our reasonable costs and expenses in reviewing the transfer application |
| Renewal Fee | The greater of 30% of our then-current franchise fee or $15,000, plus all amounts necessary to reimburse us for our reasonable out-of-pocket costs and expenses associated with renewing, including legal and accounting fees |
| Technology Fee | $350.00/Month (I.T. Support Fee) |
| Audit Fee | Cost of audit |
| Local Marketing | 2% of Royalty Sales |
| Cooperative Marketing | 2% of Royalty Sales, unless with our approval the members of the Cooperative agree to a larger fee |
| Marketing Fund | Current: 0.3% of Royalty Sales; Maximum: 2.5% of Royalty Sales |
| Marketing Fee | 0.5% of Royalty Sales (currently not charging) |
| Marketing & Promotional Materials | Currently based on our cost of acquisition, plus reasonable cost to cover our administrative and other related expenses |
| Interest | Lesser of 18% per annum or highest rate allowed by applicable law |
| Gift Card Sales Fee | Currently, 5% of third party redeemed gift cards. Maximum charge up to the actual cost of participating in our 3rd Party Gift Card program. |
| Initial Management Training | Currently, $3,500 per person (for additional personnel/restaurants) |
| Service Coach | Markets with 0-10 restaurants, $7,500 annually, per restaurant; Markets with 11 or more stores, $6,250 annually, per restaurant |
| Product Coach | Markets with 0-10 restaurants, $7,500 annually, per restaurant; Markets with 11 or more stores, $6,250 annually, per restaurant |
| Certification/Retraining Fees | Our associated costs and charges for wages and meal expenses (currently, $16 per hour for coordinators and $15 per hour for trainers, plus overtime wages and per diem, and for meat cutters, it is the current rate they receive in their restaurant, which averages around $16 per hour) for our certification personnel, plus expenses per Restaurant. |
| Additional Training | A reasonable fee that will be determined for each program based on our costs of providing the training, creating materials, including our costs of providing instructors and training materials |
| Remedial Assistance | Our associated costs and charge for wages and meal expenses (currently, $16 per hour for coordinators and $15 per hour for trainers, plus overtime wages and per diem) for our representatives providing on-site remedial assistance |
| Securities Offering Fee | $3,500 or any greater amount necessary to reimburse us for our reasonable costs and expenses in reviewing the proposed securities offering |
| Background Checks | Approximately $45 -$100 per background check |
| Inspection and Testing | Cost of inspection, if applicable, and cost of test |
| Indemnification | Varies according to loss |
| Insurance Fee | A reasonable amount based on our expenses |
| Employment Fee | Employee’s compensation for the 6-month or shorter period (between 4 to 6 months) immediately before his termination of employment with his former employer |
| Opening Training Materials | $2,500 or more, based on new additions |
| Opening Trainer T-shirts and Training Gifts | $1,650 or more, based on quantity |
| Force Majeure | Minimum Fee |
| Costs and Attorneys’ Fees | Will vary |
| Managing Partner Compensation Program | Will vary (Salary - semi-monthly, Bonus/profit sharing distribution monthly) |
| Remodeling Requirements | Varies according to need |
| Copyright License Expense | Varies according to third party license fees assessed |
| Liquidated Damages | $1,000 per violation for operational violations and $200 per violation for financial and other reporting violations |
| Inspection and Post-Termination/Post-Expiration Fee | A reasonable fee based on our expenses |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | 16 to 18 weeks |
| Classroom Training | 94 hours |
| On-the-Job Training | 70 days |
| Training Location | Restaurant operated by one of our affiliates or at another location we select |
| Additional Training | Franchisor may charge a fee for additional training programs and seminars, which may include Operational, administrative, POS and computer training. |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Non-exclusive |
| Exclusive Territory | No |
| Territory Size | Up to 10-mile radius |
| Description | The Assigned Area is site-specific and may range from a minimum of the Restaurant location itself up to a maximum radius of 10 miles. It is described by boundary streets or highways, city limit or county line boundaries, or by an area encompassed within a specific distance or range of distances or other comparable methods. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 10 years |
| Renewal Term | Two additional 5-year terms |
| Renewal Fee | The greater of 30% of our then-current franchise fee or $15,000, plus all amounts necessary to reimburse us for our reasonable out-of-pocket costs and expenses associated with renewing, including legal and accounting fees |
| Renewal Conditions | Franchisee must give written notice 6-12 months prior to term end, repair/replace equipment and modernize premises to current standards, not be in default, satisfy all monetary obligations, have right to possess premises, pay renewal fee, sign then-current agreement (which may differ), and comply with current qualification/training requirements. |
| Transfer Fee | $3,500 or any greater amount necessary to reimburse us for our reasonable costs and expenses in reviewing the transfer application |
| Transfer Conditions | Franchisor's consent is required and will not be unreasonably withheld. Conditions include satisfying all accrued monetary obligations, not being in default, transferor executing a general release, transferee meeting franchisor's criteria (educational, managerial, business, character, financial resources), transferee executing current franchise agreement and ancillary agreements, transferee renovating/upgrading the Restaurant, transferor remaining liable for pre-transfer obligations, and transferee completing required training. |
| Termination for Cause | Franchisor may terminate for cause, including failure to pay monies owed (5 days notice), failure to obtain confidentiality/noncompetition covenants (30 days notice), failure to maintain insurance (7 days notice), unauthorized use of Marks (24 hours notice), failure to obtain approval/consent (30 days notice), failure to construct/remodel (30 days notice), operating at unapproved location (5 days notice), insolvency/bankruptcy, conviction of felony/moral turpitude crime, threat to public health/safety, maintaining false records, material breach of representations/warranties, or two or more defaults within 12 months. |
| Non-Compete Period | During the term of the franchise and for 2 years after termination or expiration |
| Non-Compete Details | During the term, franchisee and controlling principals cannot own, operate, or have financial interest in a competitive business in the US, its territories, or any country where franchisor uses similar marks. After termination/expiration, for 2 years, they cannot engage in a competitive business at the approved location, within the assigned area, or within a 30-mile radius of any Texas Roadhouse Restaurant. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | Yes |
| Participation Details | The Operating Principal must devote substantial full time and best efforts to the supervision and conduct of the franchised business. If the franchisee is an individual, they will be the Operating Principal. If not an individual, the Operating Principal must be a Controlling Principal with an equity interest and sole authority to act for the franchisee. A Managing Partner is also required to direct daily operations and management, devoting full time and best efforts. |
| Required Suppliers | Franchisees must purchase or lease items that meet franchisor specifications and standards, and may be required to purchase certain items from designated or approved suppliers. This includes all food and beverage items, special recipe and proprietary products (e.g., seasonings, mixes, sauces), logoed merchandise (e.g., T-shirts, hats), and the Aloha Table Service point of sale (POS) system. Franchisor also requires contracting with Comcast Network Solutions for high-speed internet and e-mail capability. |
| Supply Restrictions | A majority of expenditures for leases and purchases in establishing and operating the Restaurant will be for goods and services subject to sourcing restrictions, requiring suppliers to be approved by the franchisor or meet specific standards. |
| Franchisor Revenue from Suppliers | Holdings (an affiliate) received approximately $2.7 million in sponsorship fees from vendors during 2020-2021, used to offset marketing costs and conference expenses. In 2022, rebates from suppliers totaled $25.4 million, which Holdings credited to company-owned and franchised Restaurants. Holdings also received $742,800 from certain franchisees for accounting and administrative services in 2022. Neither the franchisor nor Holdings received revenues from franchisee purchases of these items. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | No |
| Description | We do not offer direct or indirect financing. We do not guarantee your note, lease or other obligation. |
Texas Roadhouse Franchise Earnings — Item 19
Texas Roadhouse does not make an Item 19 financial performance representation in their FDD. This means they do not disclose revenue, profit, or earnings data for franchised locations. Before investing, ask the franchisor directly for franchisee contact information so you can speak with existing owners about their actual financial performance.
Texas Roadhouse does not include an Item 19 financial performance representation in their FDD. Contact information for current and former franchisees is listed in Item 20 of the FDD.
Texas Roadhouse Litigation & Risk Flags
Clean Litigation RecordTexas Roadhouse has no pending litigation actions listed in their FDD. There is also no bankruptcy history disclosed.
Litigation and bankruptcy data is sourced from Items 3 and 4 of the FDD. Always verify current status directly from the most recent FDD.
Texas Roadhouse System Growth
Total Units
614
Franchised
62
Company-Owned
552
Texas Roadhouse currently operates 62 franchised locations and 552 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2020 | 0 | 1 | 68 |
| 2021 | 1 | 0 | 69 |
| 2022 | 0 | 7 | 62 |
Transfers: 0 | Closures: 8
State Registrations
Registered in 6 states: California, Indiana, Michigan, North Dakota, Washington, Wisconsin
Franchisor Financials (Item 21)
Revenue
$26.1M
Net Income
$269.8M
Total Assets
$2525.7M
Audited by KPMG LLP for year ending December 27, 2022.
Texas Roadhouse Franchise — FAQ
The total investment to open a Texas Roadhouse franchise ranges from $4,349,500 to $6,801,500, per their Franchise Disclosure Document. This includes the initial franchise fee of $40,000. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
Texas Roadhouse charges a royalty fee of 4% of Royalty Sales of gross sales, plus a Current: 0.3% of Royalty Sales; Maximum: 2.5% of Royalty Sales (Marketing Fund). 2% of Royalty Sales (Local Marketing). 2% of Royalty Sales (Cooperative Marketing). Total required marketing contributions or payments will not exceed 3% of Royalty Sales. contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the Texas Roadhouse 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 Texas Roadhouse to ensure you have the most up-to-date version.
Texas Roadhouse does not provide an Item 19 financial performance representation in their FDD, which means they do not disclose franchisee revenue or earnings data. Prospective investors should contact existing franchisees directly (listed in Item 20 of the FDD) to gather real-world financial performance information.
Texas Roadhouse has been franchising since 1995. The FDD shows an investment range of $4,349,500-$6,801,500, a 4% of Royalty Sales royalty, and no Item 19 earnings disclosure. There is no pending litigation. Review the full FDD and contact current franchisees listed in Item 20 before making any investment decision.
The franchise fee is $40,000 and the total investment ranges from $4,349,500 to $6,801,500 depending on location size and market. A minimum of $1,700,375 in liquid capital is required. 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 Texas Roadhouse and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with Texas Roadhouse or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com