How to Finance an Arby’s Franchise: Formats, Fees and SBA
By Anthony Cornella
An Arby’s franchise loan usually finances a drive-thru restaurant from the ground up: the land or lease, the building, the kitchen and the working capital to reach steady sales. Because Arby’s offers three distinct building formats with very different footprints, the size and structure of the loan can change considerably depending on which one fits your site.
Below, we cover what Arby’s discloses about fees, investment and owner qualifications, how each format affects real estate and construction financing, how SBA lending works for this brand, and what lenders look for when they review an Arby’s project or the purchase of an existing restaurant.
US Professional Funding is not affiliated with, sponsored by or endorsed by Arby’s; the name is used only to describe the business. Figures from the franchisor’s disclosure document and franchising materials can change, loan programs and terms vary by lender and borrower, and every loan is subject to review and approval. Nothing here is legal, tax or investment advice. Review the current Franchise Disclosure Document (FDD) and franchise agreement with a qualified franchise attorney and accountant before signing.
Arby’s Franchise Loan at a Glance
- Total initial investment: $651,550 to $2,456,600, according to Arby’s franchising materials, which reference the FDD issued March 26, 2026.
- Initial franchise fee: $37,500.
- Development fee: $12,500 per restaurant.
- Royalty: 4% of gross sales.
- Advertising: a minimum combined advertising fee of 5.2% of gross sales.
- Owner qualifications: $500,000 in liquid assets and a net worth of $1,000,000.
- Formats: freestanding, endcap and a newer small format, each designed with a drive-thru.
- System size: more than 3,500 restaurants in six global markets, according to the franchisor.
- SBA Franchise Directory: listed as Arby’s (code S0130) with no additional directory note.
What Is Arby’s?
Arby’s is a quick-service restaurant brand known for roast beef and other sliced-meat sandwiches. Brothers Leroy and Forrest Raffel founded Arby’s in Boardman, Ohio, in 1964, opening with a hot, made-to-order roast beef sandwich. Today Arby’s is part of a larger multi-brand restaurant company that provides shared services to its franchisees.
The franchisor describes more than 3,500 restaurants in six global markets. Its support list for franchisees includes operational systems, initial and ongoing training, a dedicated franchise business consultant, real estate and construction guidance, national marketing and collective media buying, loyalty programs, culinary innovation, brand apps and websites, restaurant technology, supply chain and reporting platforms.
Why lenders view Arby’s the way they do. To a lender, Arby’s is a long-established, nationally recognized quick-service brand built around drive-thru traffic, which tends to support consistent transaction volume. The brand’s SBA directory listing without special conditions keeps SBA financing straightforward. The main variables lenders focus on are the site, the format chosen, the construction budget and the operator’s ability to manage labor and food costs in a high-volume kitchen.
Arby’s Restaurant Formats and Why They Matter for Financing
The franchisor’s materials describe three formats. Each one changes how much land, building and equipment the loan must cover.
Freestanding. A freestanding restaurant of 1,375 square feet seating 20 to 24 guests, with drive-thru, walk-in and delivery service. Ideal sites have dense daytime populations, ample parking, high visibility and room for outdoor seating. This format typically involves buying or ground-leasing a pad and constructing a building, which makes real estate the largest part of the financing.
Endcap. An endcap restaurant of 1,600 to 2,500 square feet seating 15 to 40 guests, designed for mixed-use developments and still including a drive-thru. Ideal sites are near retail, prominent from the street, accessible from both directions on the primary street and close to the main road. Endcaps are usually leased, so the loan concentrates on tenant improvements, equipment and opening costs rather than land.
Small format. The newest format is 1,070 square feet, built either modularly or stick-built, with a drive-thru, and fits on a half-acre (22,000 square foot) lot. The franchisor points to sites with strong building and drive-thru visibility, a left-turn lane or traffic-light-aided entry, urban locations with small or limited lots, and markets with high labor costs. A smaller lot and building can reduce land and construction cost, and a modular building may shorten the construction period, both of which matter to a construction lender.
Choosing the format is not only an operational decision. It largely determines whether your Arby’s franchise loan looks like a real estate loan, a leasehold improvement loan or something in between.
Arby’s Franchise Costs
Initial franchise fee. Arby’s franchising materials list an initial franchise fee of $37,500 and a development fee of $12,500 per restaurant. Item 5 of the current FDD explains when each fee is paid, how they relate to each other and whether any portion is credited or refundable.
Real estate and construction. Land acquisition or ground lease costs, site work, utility connections, the building itself (stick-built or modular for the small format) and the drive-thru lane and canopy are typically the largest items in a freestanding project. For an endcap, the comparable costs are lease deposits, landlord-approved tenant improvements and drive-thru construction.
Equipment, signage and technology. Slicers, ovens, fryers, holding equipment, refrigeration, beverage systems, drive-thru communication and order-confirmation equipment, point-of-sale and kitchen display systems, menu boards and building signage all belong to the franchisee.
Opening costs and working capital. Training, pre-opening payroll, opening inventory, grand opening marketing, insurance, permits and an operating reserve round out the budget.
Total investment. Arby’s franchising materials, referencing the FDD issued March 26, 2026, put the total initial investment at $651,550 to $2,456,600. The range reflects differences in format, site and real estate approach. Review the full Item 7 table for each line item’s range and assumptions. The categories that typically appear in the table and in a lender’s sources-and-uses budget include:
- Initial franchise fee and any development fee
- Real estate purchase or lease deposits and rent before opening
- Site work, construction or tenant improvements
- Building, including modular construction where applicable
- Kitchen equipment, furniture and fixtures
- Signage, menu boards and drive-thru systems
- Point-of-sale and technology
- Architecture, engineering and permits
- Opening inventory, training and grand opening marketing
- Additional funds for the initial operating period
Ongoing Fees and How They Affect Your Loan
Royalty. Arby’s lists a royalty of 4% of gross sales.
Advertising. The franchisor lists a minimum combined advertising fee of 5.2% of gross sales. That combined figure can include national and local components, so check Item 6 of the FDD for how it is allocated and whether it can change.
Technology and other fees. The franchisor’s support list includes restaurant technology, apps, loyalty programs and reporting platforms, and Item 6 discloses the related fees along with transfer, renewal and training charges.
Remodels and reimages. Restaurant brands periodically update design, technology and equipment standards, and franchisees fund those updates. Ask about any remodel obligation tied to your agreement or a transfer, especially on an older restaurant.
How lenders factor these costs in. Royalty and advertising together claim a fixed share of every sales dollar before food, paper, labor, occupancy and debt service. Lenders typically build those percentages into projections first and then test whether the restaurant can cover loan payments with a margin to spare, including in a slower-sales case.
Franchisor Requirements for New Owners
Arby’s franchising materials list two financial qualifications:
- Liquid assets: $500,000.
- Net worth: $1,000,000.
The franchisor also expects candidates to complete its process and training. Restaurant operating experience, multi-unit management background and a capable management team strengthen an application with both the franchisor and lenders. Our article on how much franchise you can afford explains how liquid capital and net worth translate into loan capacity.
The approval process. Arby’s outlines five stages: apply by submitting your information, hold a preliminary call with the franchise sales team, review the Franchise Disclosure Document, interview with the franchise leadership team, and sign the franchise agreement. Site approval and construction planning follow, with the franchisor’s real estate and construction guidance.
Ways to Own an Arby’s
A new restaurant. Building a new Arby’s means choosing a format, securing a site and financing construction, equipment and opening costs. Lenders underwrite new restaurants on projections, the site, the operator’s experience and the strength of the guarantors. See our franchise start-up financing options.
Buying an existing restaurant. Existing Arby’s restaurants change hands between franchisees. Lenders can underwrite actual sales, margins and the condition of the building and equipment. The franchisor must approve the buyer and the transfer, and any reimage required at transfer becomes part of the financing plan. Our article on buying a franchise resale covers transfer approval, fees and seller notes.
Multi-unit development. Operators who commit to several restaurants open them on a schedule, financing each restaurant as its site is approved. More on that below.
Financing Options for an Arby’s Franchise
SBA 7(a) loans. The SBA 7(a) loan program can fund the franchise fee, construction, equipment, working capital and, in many cases, real estate in a single loan, subject to lender approval and program rules. It is often used for leased endcaps and for acquisitions of existing restaurants.
SBA 504 loans. For a freestanding or small-format restaurant on land the franchisee will own, an SBA 504 loan can finance land, construction and long-lived equipment through a senior lender loan combined with an SBA-backed portion. Ownership of a drive-thru pad can be a lasting asset that supports later refinancing.
Conventional real estate and term loans. Experienced operators may use conventional construction and term loans, particularly when financing several restaurants at once or when the project exceeds SBA limits. Learn how we approach restaurant real estate acquisition financing.
Equipment financing. Meat slicers, ovens, fryers, refrigeration, beverage equipment, drive-thru headsets and timers, digital menu boards and point-of-sale systems can be financed or leased separately. Separate equipment financing can match repayment to the useful life of each asset. Explore restaurant equipment financing and leasing.
Working capital and lines of credit. A new restaurant needs cash for pre-opening payroll, opening inventory and the ramp-up period while sales build, and an existing restaurant may need a cushion after a change of ownership. See our franchise working capital programs.
Sale-leaseback. An operator who builds a freestanding restaurant on owned land may later sell the real estate and lease it back to free up capital for the next restaurant. Our article on franchise sale-leasebacks explains the trade-offs.
Seller financing on resales. A seller may carry part of the price on an existing restaurant. A seller note would need to be acceptable to the senior lender, is typically subordinate to it and may be limited by SBA rules when an SBA loan is involved.
SBA Loans for Arby’s Franchisees
SBA lenders generally require a franchise brand to appear on the SBA Franchise Directory before making an SBA-guaranteed loan to a franchisee. A listing indicates that the brand’s franchise documents have been reviewed for SBA eligibility; it does not approve any individual borrower or project.
Arby’s directory status. Arby’s appears on the SBA Franchise Directory as “Arby’s” under code S0130, with no additional note or condition attached to the listing. In plain English, an SBA lender does not have to work around a brand-specific restriction, such as a limitation on franchisor purchase options or liens, when structuring an Arby’s loan. Directory status can change, so confirm it with your lender when you apply. Our article on the SBA Franchise Directory explains how to check a listing.
SBA application tips. Prepare a personal financial statement and recent tax returns for each owner, a resume showing restaurant experience, the FDD and franchise agreement, site information and a lease or purchase contract, construction bids or a contractor estimate, equipment quotes, a sources-and-uses budget and projections. The SBA 7(a) program maximum is currently $5 million, and program rules can change. Our SBA loan calculator can help with early payment estimates for planning only.
How Lenders Evaluate an Arby’s Deal
Personal credit and financial history. Lenders review credit, tax returns and personal financial statements and typically require personal guarantees from significant owners.
Net worth and liquidity. Arby’s lists $500,000 in liquid assets and a $1,000,000 net worth. Lenders look beyond those thresholds to the cash remaining after the equity injection and closing costs, because construction overruns and a slow ramp-up are real risks for a new restaurant.
Industry and management experience. Quick-service experience, especially managing drive-thru speed, labor scheduling and food cost, carries significant weight. First-time owners should present the general manager and shift leadership they plan to hire.
Business plan and projections. Arby’s projections should reflect the chosen format, drive-thru share of sales, daypart patterns, delivery and digital orders, food and paper cost, labor, the 4% royalty and 5.2% advertising, occupancy cost and debt service. For new construction, include a realistic ramp-up period and the timing of draws.
The FDD and franchise agreement. Lenders focus on Items 5, 6, 7, 10, 12 and 17: fees, the investment estimate, any franchisor financing, territory and the term, renewal and transfer provisions. Item 19 tells you whether the FDD includes financial performance representations.
Site, lease or real estate. For freestanding and small-format sites, lenders order an appraisal and environmental review and look at access, visibility and drive-thru stacking. For endcaps, they review the lease term, renewal options, landlord consent and any co-tenancy or use restrictions.
Historical financials for existing restaurants. For a resale, expect to provide several years of profit and loss statements, sales reports and tax returns, plus an equipment list and any reimage requirements.
Drive-Thru, Kitchen and Construction Considerations
Most of an Arby’s restaurant’s value to a lender comes from its drive-thru and kitchen. The drive-thru lane, menu boards, speaker and headset system, order-confirmation screens and timers determine throughput. The kitchen relies on slicers, ovens, fryers, holding cabinets, refrigeration and beverage systems.
Construction lending. For a new freestanding or small-format restaurant, construction lenders release funds in draws tied to progress, inspections and lien waivers. A modular building for the small format can change the draw schedule because part of the work happens off-site, so confirm with your lender and builder how deposits and deliveries will be funded.
Equipment lifecycle. When buying an existing restaurant, ask for the age and service history of major equipment and the drive-thru technology. Planned replacements can be built into the purchase loan or financed separately.
Multi-Unit Growth and Development Agreements
Arby’s lists a development fee of $12,500 per restaurant, so a multi-unit commitment carries fees for each planned location. A development schedule creates a series of financing needs rather than a single loan, so plan each restaurant’s capital in sequence.
Financing the second and third restaurant. Once the first restaurant has operating history, lenders can underwrite its cash flow alongside projections for the next one. Some operators finance each restaurant separately; others move to a conventional facility that covers several restaurants once the group is established.
Using real estate to grow. Owners who build on owned land may refinance or use a sale-leaseback to recover equity for later restaurants. Each approach changes occupancy cost, so model it before committing.
Real-World Scenarios
A small-format restaurant on a tight urban lot. An operator with quick-service management experience finds a half-acre corner lot with a traffic light and chooses the small format. The project combines an SBA 504 loan for land and building with separate equipment financing, and the lender’s draw schedule accounts for the modular building delivery.
An endcap in a new mixed-use center. A first-time Arby’s owner signs a lease for an endcap with a drive-thru. Because there is no land to buy, an SBA 7(a) loan covers the franchise fee, tenant improvements, equipment and working capital.
Buying an existing restaurant from a retiring franchisee. A buyer acquires an established freestanding Arby’s with the real estate. The lender underwrites the restaurant’s history, appraises the property and includes a reimage budget required by the franchisor as part of the transfer.
A multi-unit operator adding locations. A franchisee with several restaurants signs for additional units, budgets the development fee for each one and finances each new site as it is approved, using the existing restaurants’ cash flow to support the requests.
Common Mistakes to Avoid
- Choosing a format before checking how it changes the real estate and construction budget
- Treating the low end of the investment range as the budget for a freestanding build
- Leaving out the 5.2% combined advertising fee when projecting cash flow
- Underestimating construction overruns and the ramp-up period before sales stabilize
- Signing a lease or land contract before financing and franchisor site approval are aligned
- Ignoring reimage requirements when buying an older restaurant
- Spending all liquid assets on the equity injection and leaving no reserve
For more pitfalls, read common restaurant loan mistakes.
Next Steps to Finance Your Arby’s Franchise
Step 1: Confirm you qualify. Compare your liquid assets, net worth and restaurant experience with Arby’s published qualifications.
Step 2: Apply and review the FDD. Submit your information, complete the preliminary call and study the FDD, especially Items 5, 6, 7, 12, 17 and 19, with a franchise attorney and accountant.
Step 3: Pick a format and target sites. Decide whether freestanding, endcap or small format fits your market, and identify sites that meet the franchisor’s criteria.
Step 4: Talk with a financing specialist. Before signing a lease or land contract, review how SBA 7(a), SBA 504 and conventional options apply to your format and how much equity a lender will expect.
Step 5: Build your budget and projections. Gather construction bids, equipment quotes and lease or purchase terms and assemble a sources-and-uses budget and projections.
Step 6: Apply for financing and coordinate approvals. Submit your loan package and align the lender’s timeline with the franchisor’s interview, signing and site approval steps.
Step 7: Close, build and open. Close the loan, manage construction draws, complete training and keep working capital in reserve through the opening period.
Arby’s Franchise Loan FAQs
How much does it cost to open an Arby’s franchise?
Arby’s franchising materials, referencing the FDD issued March 26, 2026, list a total initial investment of $651,550 to $2,456,600. The format, the site and whether you buy land drive where a project falls in that range.
What is the Arby’s franchise fee?
Arby’s franchising materials list an initial franchise fee of $37,500 and a development fee of $12,500 per restaurant. Item 5 of the FDD explains how and when each is paid.
What royalty and advertising fees does Arby’s charge?
Arby’s lists a royalty of 4% of gross sales and a minimum combined advertising fee of 5.2% of gross sales.
How much liquid capital and net worth do I need?
Arby’s lists $500,000 in liquid assets and a net worth of $1,000,000.
Is Arby’s SBA approved?
Arby’s appears on the SBA Franchise Directory under code S0130 with no additional note, so eligible borrowers can apply for SBA 7(a) or SBA 504 financing, subject to lender approval.
Can an Arby’s franchise loan cover the land and building?
Yes. For a freestanding or small-format restaurant on owned land, SBA 504, SBA 7(a) or conventional real estate loans can finance land and construction, subject to appraisal and approval.
Which Arby’s format is cheapest to finance?
It depends on the site and real estate. An endcap usually avoids land costs, while the small format’s 1,070-square-foot building and half-acre lot can reduce land and construction compared with a freestanding restaurant. Compare complete budgets for each option.
Can I finance equipment separately?
Yes. Kitchen equipment, drive-thru systems, digital menu boards and point-of-sale technology can be financed or leased apart from the real estate or business loan.
Can I buy an existing Arby’s?
Yes, with franchisor approval of the buyer and transfer. Lenders underwrite existing restaurants on their actual financial history and may require a budget for any reimage.
Can a first-time business owner get an Arby’s franchise loan?
It is possible when the candidate meets the financial qualifications, completes the franchisor’s process and shows relevant management experience or a strong hired team. Lenders weigh experience heavily for quick-service restaurants.
Does Arby’s offer financing?
Review Item 10 of the current FDD, which discloses whether the franchisor or an affiliate offers any financing. Most franchisees arrange their own loans.
How long is an Arby’s franchise agreement?
Item 17 of the current FDD sets out the term, renewal and transfer conditions. Lenders generally want the remaining term to extend beyond the loan’s repayment period.
Does the FDD include financial performance information?
Check Item 19 of the current FDD to see whether it includes financial performance representations. For an existing restaurant, rely on its actual financial statements.
Final Thoughts
An Arby’s restaurant is a drive-thru business first, and the format you choose shapes almost every part of the financing, from land and construction to equipment and working capital. Buyers who match the format to the site, budget realistically for construction and ramp-up, and use the brand’s clean SBA directory listing to their advantage give themselves a strong foundation for their first restaurant and the ones that follow.
US Professional Funding helps franchise owners and buyers finance new restaurants, acquisitions, real estate, equipment and working capital. Learn more about our franchise financing solutions and restaurant financing programs.
