Checkers and Rally's are among the most recognizable names in quick-service dining, with a drive-thru-only model that keeps overhead low and throughput high. If you are exploring how to fund a Checkers or Rally's franchise, understanding the checkers franchise cost and financing options available to you is the critical first step. This guide covers everything from startup investment figures to SBA loans, equipment financing, and working capital solutions that can make your franchise a reality.
In This Article
Checkers Drive-In Restaurants (known as Rally's in many Midwestern and Eastern markets) is one of the oldest double drive-thru fast-food chains in the United States. Founded in 1986 and headquartered in Tampa, Florida, the brand operates more than 800 locations across the country and has built a loyal following based on its value-priced burgers, hand-seasoned fries, and milkshakes. The brand is owned by private equity-backed Checkers Drive-In Restaurants, Inc., which has invested heavily in remodeling, technology upgrades, and menu innovation to keep the brand competitive in a crowded fast-food landscape.
What sets Checkers and Rally's apart from most QSR franchise opportunities is its modular, freestanding building design. The restaurant structures are prefabricated and purpose-built for drive-thru-only service, which dramatically reduces real estate costs compared to full-service dining concepts. This lower cost of entry makes the brand accessible to first-time franchise owners and multi-unit operators alike. According to Forbes, drive-thru-only concepts have consistently outperformed dine-in restaurants in both revenue resilience and post-pandemic recovery.
The brand operates under a franchise model that grants exclusive or protected territories to franchisees, provides operational support, national marketing, proprietary recipe use, and access to the brand's supply chain. Checkers and Rally's have been expanding their footprint through both new franchise agreements and the conversion of company-owned locations to franchise ownership. The result is one of the more approachable franchise investment opportunities in the quick-service restaurant sector, with a lower initial investment than many competing concepts.
Brand Snapshot: Checkers and Rally's serve more than 100 million customers per year across their 800+ U.S. locations. The brand's average unit volume (AUV) and drive-thru-only model translate into lower labor costs and faster ticket times compared to traditional QSR competitors.
Understanding the full checkers franchise cost is essential before approaching any lender. The investment varies depending on whether you are building a new freestanding unit, purchasing an existing location, or converting a suitable property to the Checkers/Rally's format. Here is a detailed breakdown based on the brand's Franchise Disclosure Document (FDD):
The relatively modest total investment compared to other national QSR brands is one of Checkers/Rally's key selling points for prospective franchisees. A full-service burger competitor might require $2 million or more to open a single location, while a Checkers drive-thru can be opened for under $1.5 million. For investors who want QSR exposure without the capital intensity of a full dine-in concept, this brand hits a strong sweet spot.
That said, multi-unit franchise agreements are increasingly common with Checkers, and many operators commit to developing 3, 5, or even 10 locations under a development agreement. When you multiply the per-unit investment, total capital requirements climb quickly - which is why having a strong financing partner matters from day one.
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Apply Now →Most Checkers/Rally's franchisees do not fund their investment entirely from personal savings. The capital stack for a single-unit drive-thru typically includes a combination of the franchisee's equity contribution, a primary loan product, and possibly a secondary working capital facility. Understanding the tools available to you helps you structure a deal that preserves cash while keeping monthly debt service at a manageable level.
The primary financing options for Checkers and Rally's franchise owners include small business loans, SBA 7(a) loans, SBA 504 loans, conventional term loans, equipment financing for the kitchen and drive-thru technology package, and business lines of credit for working capital. The right combination depends on your credit profile, available equity, whether you are building new or purchasing an existing location, and how many units you plan to develop.
For new franchisees purchasing their first location, the SBA 7(a) loan is often the starting point. For experienced multi-unit operators who want to move quickly, conventional commercial loans or bridge financing may be preferred. Equipment financing is almost always a separate product that runs alongside the primary real estate or business acquisition loan.
A conventional term loan from a commercial bank or non-bank lender provides a lump sum that you repay over a fixed period with scheduled monthly payments. For a Checkers/Rally's build with a total project cost of $800,000, a well-qualified borrower might secure a 10-year term loan at competitive rates with a 20 to 30 percent equity contribution. Conventional loans close faster than SBA loans and involve less paperwork, but typically require stronger credit and more collateral than government-backed options.
The SBA 7(a) loan program is one of the most popular financing tools for franchise buyers. Loan amounts go up to $5 million, repayment terms can stretch to 10 years for business acquisition or 25 years when real estate is included, and down payment requirements are typically 10 to 20 percent of the total project cost. The SBA's Franchise Registry includes Checkers as an eligible brand, which streamlines the eligibility review and speeds the underwriting process. Learn more about SBA loan options at Crestmont Capital.
If your Checkers franchise project involves purchasing or constructing owner-occupied commercial real estate, the SBA 504 program is worth exploring. The 504 structure combines a conventional lender first mortgage at 50 percent of project costs with a CDC second mortgage at 40 percent and a 10 percent borrower down payment. The fixed-rate CDC portion provides long-term payment certainty. For franchisees who own their building rather than lease, the 504 can significantly reduce the amount of equity required at closing.
The SBA's backing of franchise loans has expanded significantly over the past decade, and Checkers/Rally's is a recognized brand in the SBA Franchise Directory. This recognition means lenders can skip the lengthy eligibility review that slows down loans for non-franchise businesses. For a Checkers franchisee, the practical benefit is faster processing and more consistent approval criteria across lenders.
The U.S. Small Business Administration offers several important protections to lenders through its guarantee programs, which translates directly into better terms for borrowers. Because the SBA guarantees up to 85 percent of the loan amount on smaller loans (and 75 percent on larger ones), lenders take on less risk, which allows them to offer lower interest rates and longer repayment terms than they could on a fully conventional basis.
For a Checkers/Rally's franchisee borrowing $700,000 to fund a new drive-thru build with $140,000 in equity (20 percent down), an SBA 7(a) loan might offer a rate of prime plus 2.75 percent with a 10-year repayment term. The monthly payment on that structure would be approximately $7,200 to $7,800 depending on the rate environment. A well-performing Checkers/Rally's unit generating $1.2 million in annual gross sales would produce enough operating cash flow to cover that debt service comfortably.
SBA 7(a) loans can also cover the acquisition of existing Checkers franchise locations. Buying an established drive-thru with proven revenue is often more attractive to lenders than new construction because the cash flow history reduces underwriting uncertainty. Experienced operators often build their portfolios by acquiring existing units, renovating and rebranding them, and then using the improved cash flow to fund additional acquisitions.
SBA Franchise Directory: Checkers/Rally's is listed on the SBA's official franchise eligibility registry, which means lenders can verify franchise eligibility quickly without a lengthy brand review. This typically saves 2 to 4 weeks in the loan origination timeline.
A Checkers or Rally's drive-thru runs on a specialized set of kitchen and technology equipment. The fryers, grills, refrigeration units, POS terminals, drive-thru communication systems, and digital menu boards are all purpose-built for a high-volume QSR operation. Rather than bundling these costs into your primary loan, dedicated equipment financing allows you to preserve your primary loan capacity for real estate and construction while financing the equipment package separately at competitive rates.
Equipment loans for restaurant buildouts typically offer terms of 36 to 72 months, with the financed equipment itself serving as collateral. This reduces the need for additional personal collateral and makes it easier for first-time franchise owners to qualify. For a Checkers/Rally's unit, the equipment package including kitchen equipment, POS systems, and drive-thru technology might total $120,000 to $180,000 - a manageable equipment loan that adds only $2,500 to $4,000 per month to your total debt service.
Another advantage of equipment financing is flexibility at the end of the term. When your equipment loan matures, you can upgrade to newer equipment, refinance at lower rates if your business has grown, or simply own the equipment free and clear. Given that Checkers/Rally's periodically updates its required equipment specifications as part of remodel or brand standard compliance cycles, having a separate equipment financing facility makes it easier to adapt.
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Apply Now →Lenders who specialize in QSR franchise financing evaluate several key factors when underwriting a Checkers/Rally's loan. Knowing these criteria in advance lets you prepare a stronger application and identify any gaps before they become surprises during underwriting.
Most SBA lenders require a minimum personal credit score of 650 to 680 for franchise loans, with scores above 700 providing more favorable rate and term options. Both the primary borrower and any co-borrowers or guarantors will have their credit reviewed. If your score is below 650, there are strategies to improve it quickly, and some non-bank lenders work with lower credit scores for borrowers who have strong cash flow from existing operations. Explore options through Crestmont Capital's business line of credit offerings if you need to bridge a credit gap.
Lenders generally want to see liquid assets equal to at least 10 to 20 percent of the total project cost. For a $900,000 Checkers franchise project, that means having $90,000 to $180,000 in accessible cash or near-cash assets. Your overall net worth (assets minus liabilities) should be positive and ideally equal to or greater than the loan amount. Borrowers with substantial real estate equity or retirement accounts can sometimes use those assets to supplement their liquid position.
Prior franchise or restaurant management experience carries significant weight with lenders. First-time franchise owners can compensate by demonstrating strong general business management history, partnering with an experienced co-owner, or hiring a proven operations manager before applying. If you have successfully operated other businesses, document that performance clearly in your business plan.
A detailed business plan is required for virtually every franchise loan. Your plan should include a market analysis demonstrating demand in your target territory, financial projections for at least three years, an explanation of your operating strategy, and a clear picture of how you will service the debt. Lenders look for a minimum debt service coverage ratio (DSCR) of 1.25x, meaning your projected operating income should exceed your annual loan payments by at least 25 percent.
For reference on similar franchise financing journeys, see our guides on Dutch Bros franchise financing and Whataburger franchise loans.
Crestmont Capital is rated the #1 business lender in the United States, with a track record of funding franchise operators across dozens of QSR brands. Unlike traditional banks that can take months to reach a credit decision, Crestmont Capital's network of lenders moves quickly, often providing term sheets within 24 to 48 hours of a complete application submission.
For Checkers and Rally's franchisees specifically, Crestmont Capital offers several advantages. First, access to multiple competing lenders through a single application means you receive the best available rate and terms rather than settling for whatever one bank offers. Second, Crestmont Capital's lending specialists understand the QSR franchise model, including drive-thru-specific unit economics, the impact of royalty and marketing fees on cash flow, and the multi-unit development agreements common in the Checkers system.
Third, Crestmont Capital's product lineup covers every financing need a Checkers franchisee might have: SBA loans for acquisition and construction, equipment financing for the kitchen buildout, fast business loans for time-sensitive opportunities, and working capital lines for ongoing operations. Having a single lending partner who understands your full capital stack simplifies your financial management as you grow.
According to reporting by CNBC, QSR franchise investment has surged in recent years as investors seek inflation-resilient business models with predictable revenue streams. Bloomberg has also reported on the drive-thru segment's continued outperformance relative to full-service dining, reinforcing the investment thesis for brands like Checkers and Rally's.
By the Numbers
Checkers/Rally's Franchise - Key Investment Stats
$30K
Initial Franchise Fee
$1.5M
Max New Unit Investment
4%
Royalty Fee on Gross Sales
800+
U.S. Locations
To make the financing options more concrete, here are three scenarios that reflect the range of situations Checkers/Rally's franchise investors typically encounter:
Marcus is a former restaurant manager with 12 years of QSR experience who wants to open his first Checkers drive-thru in a suburban market in Georgia. His total project cost is $950,000, including land, construction, and equipment. Marcus has $200,000 in liquid assets and a personal credit score of 710. He applies for an SBA 7(a) loan of $760,000 (80 percent of project cost), putting $190,000 down. With a 10-year term and a competitive interest rate, his monthly payment is approximately $8,200. His market analysis projects annual gross sales of $1.3 million at a 15 percent EBITDA margin after royalties, producing $195,000 in operating income and a DSCR of 1.98x - well above the required 1.25x threshold. Marcus closes in 55 days and opens 8 months later.
Priya owns two Checkers locations in Ohio and has been approached by Checkers corporate about purchasing a company-owned unit that is being refranchised. The purchase price is $500,000, and Priya estimates she needs $75,000 for initial remodeling. Her total project cost is $575,000. Because she has an established operating history with her existing units, her lender qualifies her for a conventional commercial loan rather than an SBA loan, with better rates and fewer documentation requirements. She closes in 30 days and takes over the unit without interruption to daily operations.
James signs a development agreement with Checkers to open 5 locations over 5 years. He uses an SBA 7(a) loan for his first unit and establishes a relationship with Crestmont Capital for subsequent units. As each location opens and generates revenue, the cash flow from earlier units supports the financing applications for later ones. By year 3, James is able to negotiate better terms on his fourth and fifth locations based on his proven track record. His total investment across 5 units approaches $5 million, funded primarily through sequential SBA loans and two equipment financing facilities.
Pro Tip: Multi-unit development agreements often come with reduced franchise fees per unit and enhanced territorial protection. If your financial profile supports it, committing to multiple locations upfront can significantly improve your overall unit economics and lender relationships.
The total checkers franchise cost ranges from approximately $750,000 to $1.5 million for a new freestanding drive-thru unit. Conversion projects or acquisitions of existing locations can range from $300,000 to $900,000. The initial franchise fee is $30,000 per location, with ongoing royalty fees of 4 percent and marketing fund contributions of 5.5 percent of gross sales.
The most common financing options include SBA 7(a) loans (up to $5 million), SBA 504 loans for owner-occupied real estate, conventional commercial term loans, equipment financing for kitchen and drive-thru technology, and business lines of credit for working capital. Most franchisees use a combination of these products to structure their total capital stack.
Most SBA lenders require a minimum personal credit score of 650 to 680. A score above 700 gives you access to better interest rates and more lenders. If your score is below 650, some non-bank lenders can work with you depending on your overall financial picture and experience. Credit scores of all co-borrowers and guarantors are reviewed.
Yes. Checkers/Rally's is an eligible franchisor listed in the SBA's Franchise Directory. This means SBA lenders can quickly verify the franchise's eligibility without an extended brand review, which typically saves 2 to 4 weeks in the loan process and makes the overall experience smoother for borrowers.
Down payment requirements vary by loan type. SBA 7(a) loans typically require 10 to 20 percent of total project costs. SBA 504 loans require just 10 percent borrower equity. Conventional commercial loans may require 20 to 30 percent down. Having liquid assets equal to at least 10 percent of project costs is a general lender requirement regardless of loan type.
Yes. Acquisition financing for existing Checkers or Rally's locations is available through both SBA 7(a) loans and conventional commercial loans. Acquiring an existing unit with a performance history is often viewed more favorably by lenders than new construction because the revenue track record reduces underwriting uncertainty.
Typical timelines range from 30 to 90 days depending on loan type and complexity. SBA 7(a) loans through preferred lenders can close in 30 to 60 days. SBA 504 loans take 60 to 90 days. Conventional commercial loans often close in 30 to 45 days for experienced borrowers with complete documentation. Having all your financial documents ready before applying significantly accelerates the timeline.
Restaurant or franchise management experience is helpful but not strictly required. Lenders prefer borrowers who have managed businesses before, but strong general business management experience can substitute for restaurant-specific history. Hiring an experienced QSR general manager or partnering with an experienced operator can also offset a lack of direct restaurant experience in the underwriting evaluation.
Standard documentation includes three years of personal tax returns, a current personal financial statement, your business plan and financial projections, a copy of the Checkers/Rally's franchise disclosure document, the franchise agreement or letter of intent, site information (lease or purchase agreement), construction bids or cost estimates, and information about your management team. SBA loans require additional forms including the SBA borrower application and lender-specific forms.
The royalty fee is 4 percent of gross sales, paid weekly or monthly to the franchisor. In addition, franchisees contribute 5.5 percent of gross sales to the brand's national and regional marketing fund. Combined, these fees represent 9.5 percent of gross sales, which is generally in line with major QSR brands. These fees must be factored into your cash flow projections and debt service calculations.
Yes. If you already own a Checkers or Rally's location and need to fund a brand-required remodel or upgrade, refinancing options and supplemental business loans are available. SBA 7(a) loans can cover remodel costs, and equipment financing is ideal for replacing kitchen equipment or updating the drive-thru technology package. A business line of credit can also provide bridge financing during a remodel period when operations may be partially disrupted.
Checkers and Rally's are the same company and operate under the same parent organization. The brand is called "Checkers" in some markets (primarily Southeast and East Coast) and "Rally's" in other markets (primarily Midwest and some Eastern states). The menu, operational model, franchise agreement terms, and investment requirements are identical. From a financing perspective, lenders treat them as the same concept.
Multi-unit development typically involves sequential financing - one loan per location as each unit is developed. Your first unit's performance history becomes the basis for financing subsequent units. Some lenders offer multi-unit facility agreements that pre-approve a borrower for a series of loans, reducing the administrative burden of repeated individual loan applications. Crestmont Capital can structure multi-unit financing solutions for qualified Checkers developers.
Crestmont Capital submits your application to multiple lenders simultaneously, generating competing term sheets so you can select the best rate and structure. Our specialists understand the QSR franchise model and can help you structure your capital stack across SBA loans, equipment financing, and working capital lines. The process typically starts with a quick online application, followed by a consultation with a lending specialist within 24 hours.
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Apply Now →The checkers franchise cost is among the most accessible in the QSR franchise space, and the drive-thru-only model offers compelling unit economics for investors who understand the fast-food industry. Whether you are building your first location or expanding an existing portfolio, having the right financing partner makes the difference between a project that stalls in underwriting and one that closes on time and opens strong.
Crestmont Capital combines a deep understanding of franchise lending with access to a nationwide network of SBA-preferred lenders, equipment finance specialists, and commercial loan providers. Our application process is fast, our specialists know the Checkers/Rally's brand, and our commitment is to get you the best possible terms for your specific situation. Apply today and take the first step toward owning a Checkers or Rally's franchise.
Disclaimer: The information provided in this article is for general educational purposes only and is not financial, legal, or tax advice. Funding terms, qualifications, and product availability may vary and are subject to change without notice. Crestmont Capital does not guarantee approval, rates, or specific outcomes. For personalized information about your business funding options, contact our team directly.