About Mel's Drive-In Franchise
Mel's Drive In is an iconic casual dining franchise blending classic American nostalgia with a contemporary menu of breakfast, lunch, and dinner offerings alongside beer, wine, champagne, and signature cocktails.
The brand also features fresh juices, smoothies, milkshakes, and desserts, creating a diverse menu that appeals to diners throughout the day.
The franchise fee is $35,000, and Mel's Drive In has been franchising since 2023 under San Francisco C&C.
Mel's Drive-In Franchise Cost & Fees
Minimum Investment
$2.1M
Average Investment
$2.8M
Maximum Investment
$3.6M
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $35,000 | One-time payment upon signing |
| Royalty Fee | 4.50% of Net Sales of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | 0.50% of Net Sales (can increase to 2.00% of Net Sales once annually on 60 days’ notice) | National brand fund |
| Total Investment Range | $2,084,000 – $3,586,000 | Includes build-out, inventory, working capital |
The investment range of $2.1M–$3.6M reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (4.50% of Net Sales) and marketing fee (0.50% of Net Sales (can increase to 2.00% of Net Sales once annually on 60 days’ notice)) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Initial Franchise Fee | $35,000 | $35,000 |
| Leasehold Improvements | $400,000 | $900,000 |
| Studies and Site Work | $2,000 | $5,000 |
| Lease Cost & Commissions | $0 | $0 |
| Architects and Engineers | $25,000 | $50,000 |
| Tenant Improvements & Construction | $800,000 | $1,200,000 |
| Design and Decor | $30,000 | $50,000 |
| Equipment, Fixtures & Fixed Assets | $480,000 | $680,000 |
| Vehicles | $0 | $0 |
| Signage | $40,000 | $100,000 |
| Computers and technology | $20,000 | $35,000 |
| Opening Inventory & Supplies | $40,000 | $55,000 |
| Additional Opening Inventory & Supplies (Liquor) | $0 | $20,000 |
| Security Deposits | $15,000 | $30,000 |
| Utility Deposits | $3,000 | $10,000 |
| Licenses & Permits | $3,000 | $100,000 |
| Grand Opening Campaign | $7,500 | $15,000 |
| Franchise Training Expenses | $6,000 | $15,000 |
| Legal and Accounting | $7,000 | $14,000 |
| Additional Funds- Working Capital | $100,000 | $100,000 |
| New Store Opening Training | $50,000 | $100,000 |
| Other | $500 | $2,000 |
| First Month’s Rent | $10,000 | $50,000 |
| Insurance- Annual Premium | $10,000 | $20,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | 50% of the initial franchise fee for additional franchises we then charge under a new Multi-Unit Development Agreement |
| Renewal Fee | 50% of the then current initial franchise fee for a single franchise |
| Technology Fee | Not currently charged; up to $500 per month (can increase once annually to keep pace with CPI-U) |
| Audit Fee | Currently $500 (if understatement of 2% or more of Net Sales, franchisee reimburses out-of-pocket expenses and administrative costs, plus audit fee. Can increase once annually to match CPI-U) |
| Additional Training Fee | $55.00 per hour plus trainer’s expenses for additional initial training requested by you |
| Supplier Approval Fee | $500 plus expenses paid to independent laboratories for testing |
| Advertising Cooperative Contribution | Up to 2% of Net Sales (Not currently charged; may be imposed in the future) |
| Loyalty Program Fees | Monthly with the Royalty Fee payment each month (Not currently charged; may be imposed in the future) |
| Purchasing Program Fee | Monthly with the Royalty Fee payment each month (Not currently charged; may be imposed in the future) |
| Supplemental Franchise Training Program Tuition | $4,500 per trainee |
| Additional Consulting Fee | $600 per day plus representative’s travel, lodging, meal, and incidental expenses |
| Gift Card Program Purchases and Fee | Cost of gift card plus third party administrator fee, currently up to 10% of gift card face amounts |
| Indemnification Costs | As incurred |
| Convention Fee | Estimated to be $700 per attendee, excluding travel, lodging and meals |
| Relocation Fee | 10% of then current Initial Franchise Fee |
| Bank Fees | Actual Bank Fees charged for insufficient funds or denied access for EFT/ACH transfer plus an administrative fee of $25 per event |
| Late Charge | Lesser of 1.5% per month or highest rate allowed by law (10% in California) |
| De-Identification Fee | Our actual costs, plus interest and an administrative fee of 15% of our actual costs |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | 3 weeks |
| Classroom Training | 32 |
| On-the-Job Training | 124 |
| Training Location | Los Angeles, CA |
| Additional Training | We may provide additional employee training at your Franchised Location. We may charge reasonable tuition, currently set at $300 per trainee per day for additional people you send to attend our franchise training program. We also reserve the right to change these rates and fees at any time or to charge a reasonable amount for any optional additional training we make available after you open the Franchised Restaurant. |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Protected Area |
| Exclusive Territory | Yes |
| Territory Size | Based on radius that takes into consideration a population of approximately 150,000. In dense urban markets, the Protected Area may be much smaller than other markets and may have vertical limits as well as horizontal limits. |
| Description | The geographic area within a radius (the “Applicable Radius”) from the Franchised Restaurant Location (i) of 1/8 mile in counties having a population over 150,000; (ii) of two miles in counties having a population of 150,000 or less. The population of the county where the Franchised Restaurant will be located is: _______________________ as of the Effective Date. No change in population after the Effective Date will affect the Applicable Radius. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 10 years |
| Renewal Term | two (2) additional periods of five (5) years each |
| Renewal Fee | 50% of the then current initial franchise fee |
| Renewal Conditions | You will be eligible to renew if at the time you must give notice of your intent to renew and at all times through the end of the Term then ending, (i) you and your Affiliates are not in default under this Agreement or any other franchise agreement with us; (ii) you and your Affiliates have satisfied all monetary obligations then due and owing to us and our Affiliates; and (iii) the Franchised Restaurant is not in the bottom quartile of franchised Restaurants for Net Sales for the preceding fiscal year, and (iv) the average quality assurance score for all of your Franchised Restaurants on the three inspections preceding the date your renewal notice must be given is at least 85%. You must give us 180 days advance notice of renewal, sign our then current form of the Franchise Agreement, which may have materially different fees, terms and conditions than your original Franchise Agreement, execute a general release of claims, complete any retraining program we may require, and pay a succession fee. |
| Transfer Fee | 50% of the initial franchise fee |
| Transfer Conditions | We may impose any condition for our approval, including (1) the proposed transferee must satisfy all of the requirements and conditions then being used to qualify a person as a new franchisee; (2) the proposed transferee must comply with Section 24 of the Franchise Agreement relating to business entities; (3) you must satisfy all of your accrued monetary obligations to us and our Affiliates; (4) you must cure all existing defaults under the Franchise Agreement; (5) you must execute and deliver a general release of all claims against us and our Affiliates; (6) the transferee must execute and deliver our then current form of Franchise Agreement with the same royalty fee and same expiration date and remaining renewal term (if any); and (7) you must pay us a transfer fee unless the transfer is an initial transfer from an individual to an entity or to any of your existing owners or any member of your immediate family. |
| Termination for Cause | We may terminate your Franchise Agreement after written notice of a curable default if you fail to cure within the time permitted or such longer period as required by law, or immediately upon written notice of an incurable default unless a longer notice period is required by law. |
| Non-Compete Period | During the term of the franchise and for a period of two years after the termination or expiration of the Franchise Agreement |
| Non-Compete Details | You, your managers and your equity owners may not engage, either directly or indirectly through any financial or beneficial interest in any other person, in any “competing business,” other than a Franchised Restaurant. A “competing business” means any restaurant serving classic American diner cuisine as its primary menu offering. For a period of two years after the termination or expiration of the Franchise Agreement, you, your managers and your equity owners may not engage in any competing business other than a Franchised Restaurant, within your Protected Area and within 25 miles from any Restaurant listed on our web site, or any directory we provide to you, at the time of termination or expiration, either directly or indirectly through any financial or beneficial interest in any other person. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | Yes |
| Participation Details | At least one person who has a significant equity ownership position in the franchisee (at least 5%) must be designated the Owner-Operator of the franchisee and attend the MDT training program. The Owner-Operator must supervise Restaurant operations and will be our primary point of contact in our dealings, but we do not require full time participation in day-to-day operations. If the franchisee is an individual, we strongly recommend that you are the on-premises supervisor you will be the Owner-Operator. Your General Manager and Kitchen Manager should have restaurant experience and must complete our MDT program. Your managers are not required to have equity interest in the franchisee’s business but will be required to sign our form of management confidentiality and non-competition agreement attached to the Franchise Agreement. |
| Required Suppliers | You must purchase all equipment, fixtures, food products, condiments, supplies, paper products, computer hardware and software, and signage from vendors we approve or to meet our specifications. All other purchases and leases must meet our standards and specifications. You must purchase or lease these items only from approved suppliers listed in our System Manual or otherwise approved by us in writing. |
| Supply Restrictions | We may be the sole approved suppliers for proprietary goods or services, or for goods and services we deem to be integral parts of the Franchised System that must be supplied on a consistent, uniform basis to all franchisees. We are currently the only approved supplier for apparel and promotional items bearing the Proprietary Marks, including t-shirts and hats. |
| Franchisor Revenue from Suppliers | As of the Issuance Date, we derive no revenue or other material consideration from franchisee purchases. We may derive revenue from suppliers from franchisee purchases in the future in our sole discretion. We intend to negotiate preferred vendor agreements with approved suppliers that we expect will provide favorable pricing and delivery terms to franchisees. These agreements may pay us revenues based on the volume of franchisee purchases, which may be measured in sales dollars or units sold. These arrangements are not in effect as of the Effective Date, but we expect them to be in place in the future. |
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 obligation. |
Mel's Drive-In Franchise Earnings — Item 19
Average Revenue
$3.8M
Median Revenue
$3.4M
Revenue Range
$3.1M – $4.7M
Sample Size
7 units
Past financial performance does not guarantee future results. Individual results will vary.
Mel's Drive-In Litigation & Risk Flags
Clean Litigation RecordMel's Drive-In 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.
Mel's Drive-In System Growth
Total Units
10
Franchised
2
Company-Owned
8
Mel's Drive-In currently operates 2 franchised locations and 8 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2020 | 0 | 0 | 10 |
| 2021 | 0 | 0 | 10 |
| 2022 | 0 | 0 | 10 |
Transfers: 0 | Closures: 0
State Registrations
Registered in 14 states: CA, HI, IL, IN, MD, MI, MN, NY, ND, RI, SD, VA, WA, WI
Franchisor Financials (Item 21)
Total Assets
$250K
Audited by SingerLewak LLP for year ending December 31.
Mel's Drive-In Franchise — FAQ
The total investment to open a Mel's Drive-In franchise ranges from $2,084,000 to $3,586,000, 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.
Mel's Drive-In charges a royalty fee of 4.50% of Net Sales of gross sales, plus a 0.50% of Net Sales (can increase to 2.00% of Net Sales once annually on 60 days’ notice) contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the Mel's Drive-In 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 Mel's Drive-In to ensure you have the most up-to-date version.
According to the Item 19 financial performance representation in their FDD, Mel's Drive-In franchise owners report average revenue of $3.8M and median revenue of $3.4M. This is based on a sample of 7 units. Past performance does not guarantee future results.
Mel's Drive-In has been franchising since 2023. The FDD shows an investment range of $2,084,000-$3,586,000, a 4.50% of Net Sales royalty, and includes an 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 $35,000 and the total investment ranges from $2,084,000 to $3,586,000 depending on location size and market. A minimum of $100,000 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 Mel's Drive-In and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with Mel's Drive-In or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com