Circle K

The franchise fee is $25,000 for a single store, dropping to $15,000 for stores 2–5 and $10,000 for 6+ stores signed simultaneously. Veterans get a 10% discount. These franchise fees are low relative to the total investment — a $25,000 entry fee on a $2M buildout is essentially irrelevant to the capital equation.

The real cost is construction and equipment. A new or rebuilt Circle K store requires $850,000–$1,500,000 in construction and leasehold improvements, $400,000–$800,000 in furniture, fixtures, and equipment, $40,000–$50,000 in point-of-sale systems, $60,000–$100,000 in opening merchandise inventory, and $20,000–$55,000 in signage. Real estate costs are excluded from the Item 7 estimate entirely — meaning your actual total investment could be substantially higher once land, lease deposits, or real property acquisition is factored in. A motor fuel operation adds another $536K–$2.63M in infrastructure.

Conversion of an existing convenience store (typically a rebranding or handover from another chain) runs $309K to $1.44M — significantly lower, and likely the more accessible path for most franchisees. Ongoing: royalty is 3.0%–5.5% of gross sales (the exact rate depends on your agreement and store type), with a $1,000/month minimum. Combined promotional fees add approximately 1.75% of gross sales. Technology fee is minimal ($50/month). Total ongoing fee burden for a single-site operator: approximately 7% of gross sales at the top royalty rate.

Circle K provides no Item 19 financial performance representations. For a $1.5M–$2.7M investment, the absence of any disclosed earnings data is a significant gap. Industry benchmarks for convenience stores provide some context: a typical convenience store (excluding fuel) generates $600K–$1.5M in annual merchandise revenue with net income margins of 3–5% after all operating costs, or $18K–$75K per year — returns that are extremely low on capital invested at this level. Fuel adds volume but razor-thin margins. The economics of convenience retail at scale depend heavily on high-volume locations with strong fuel traffic, lottery, and foodservice revenue streams. Before committing, request audited financials from existing Circle K franchisees and compare against your proposed site's traffic data and competitive landscape.

Circle K's North American footprint is massive — 6,125 total locations as of the 2025 FDD — but the franchised component is shrinking. Franchised units: 639 in fiscal 2023, 586 in fiscal 2024, 569 in fiscal 2025. Company-owned grew from 5,289 to 5,556 over the same period. The direction is unambiguous: Couche-Tard is acquiring or converting franchised locations to company operation. The net change across all Circle K locations is marginally positive (+62 in fiscal 2025), driven entirely by corporate expansion. This doesn't necessarily mean your location is at risk, but it does mean you're entering as a minority partner in a system that's trending toward full corporate control.

The structural trend of franchised unit decline is the most important flag. As corporate Circle K grows its company-owned store count and franchised count shrinks, you may face competitive pressure from company-owned stores in adjacent territories that can outspend you on promotions, pricing, and technology. The real estate exclusion from Item 7 is also unusual — most franchise FDDs include real estate costs or at least a range. Your actual capital requirement could be $500K–$1M higher than the Item 7 estimate once site-specific land costs are included.

The motor fuel security deposit of $20,000–$50,000 is held in a non-interest-bearing account — a real cost-of-capital on funds tied up indefinitely. The relocation fee is $12,500 (50% of the current franchise fee) — modest in the context of a multi-million dollar investment but reflects the administrative overhead of any change. The transfer fee equals the then-current franchise fee ($25,000), plus the franchisor retains a right of first refusal on any sale. For a capital-intensive business at this scale, combined exit costs can be substantial.