Can you buy a Cafe Rio Franchise? Alternatives, Cost, & Profit

The demand for Mexican Grill has certainly reached an unprecedented stage, which has enabled several chains to capitalize on the industry’s growth prospects and has allowed aspiring entrepreneurs to partner with such chains that have established themselves as renowned units in the industry.

If you’ve ever been to a Cafe Rio restaurant in your area and thought about owning one yourself, then you’ll definitely want to check out our detailed article on Cafe Rio Franchise.

In this comprehensive post, we cover everything from the expected initial investment and the potential for growth in the industry to the all-important question of whether Cafe Rio offers franchise opportunities.

• Brand: Cafe Rio
• Founded: 1997
• Founder: Steve Vaughan, CEO
• Industry: Food and Beverages
• No. of outlet: 150
• Area served: United States
• Franchise Fee: NA
• Royalty Fee: NA
• Model: Self-owned and operated
• Est. Initial Investment: $750,000 to $1.5 million

Overview of Cafe Rio Franchise

Cafe Rio restaurant was established way back in 1997 in a little town in St. George by the visionary founders, Steve and Patricia Stanley.

Specialized in serving authentic dishes derived from inspired recipes and traditional cooking of Northern Mexico’s Rio Grande region, Southern Texas, and New Mexico, Their first outlet was instant success in the local hood.

With a solo mission to serve “fresh food, made fresh”, Cafe Rio went on its expand its presence in and around Utah and beyond. Within a span of seven years, Cafe Rio became a chain of six outlets.

As of 2022, Cafe Rio was operating nearly 150 outlets, primarily located in states such as Arizona, California, Washington, and others.

Well, What’s popular at Cafe Rio restaurants?

Cafe Rio has found its special place in the Mexican Grill restaurant industry, and it’s no wonder considering their diverse menu filled with mouthwatering dishes like tostadas, salads, burritos, desserts, tacos, soups, and beverages.

Along with this, the chain also provides on-demand catering services, which further enhances its strong brand presence in the industry.

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The Journey of Cafe Rio

As mentioned earlier, it all began in 1997 in St. George with a mission to offer freshly prepared Mexican food across the country.

With its secret recipe and extensive experience in the food and beverage industry, Cafe Rio expanded to six more locations by 2004.

In 2004, entrepreneur Bob Nilsen, who shared a similar vision to Stanley’s, purchased all of their outlets and further extended the brand’s presence throughout the country.

Today, with over 150 outlets spread across the country, Cafe Rio stands as a prominent leader in the Mexican Grill Restaurant industry.

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Why consider owning a Cafe Rio Franchise? (if offered)

1. Pioneer in the industry:
   • Cafe Rio has been operating its outlets since 1997, and its extensive experience of nearly two decades has helped the chain to understand the overall Mexican food industry and build a loyal customer base for their foods.
2. Growing food industry:
   • Undoubtedly, the Mexican grill food industry is growing and partnering with a brand like Cafe Rio will certainly worth your investment (if opened at high traffic areas).
3. Delicious range in menu:
   • Throughout the years, Cafe Rio has garnered an immense following thanks to its mouthwatering array of Mexican dishes. With nearly $4 billion in system sales, it only reinforces its reputation even more.
4. Training and support:
   • Interested franchise prospects may also get benefit from Cafe Rio’s proven business model and successful track record of operating its outlet, and its extensive training program may provide enough insight on company’s operation and day-to-day task.
5. Marketing and advertising Support:
   • As a franchisee, you’ll leverage Cafe Rio’ marketing campaigns, such as social media promotion and digital advertising to create brand awareness in your neighborhood.

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Is Cafe Rio a Franchise?

Undoubtedly, Cafe Rio is one of the most popular and pioneering brands in the Mexican Grill restaurant industry that operates over 150 restaurants nationwide.

As of September 2023, Cafe Rio Restaurants continues to operate as a chain of company-owned outlets and has not offered franchise opportunities to individuals or businesses.

Therefore, candidates looking to franchise a Cafe Rio outlet should either contact them in-person or can check out other available food and beverages franchises.

How much does a Cafe Rio Franchise Cost?

Cafe Rio Restaurants has refrained from selling its franchises to individuals or entrepreneurs and currently it operates nearly 150 outlets under the company-owned and operated concept.

Nevertheless, considering its existing outlet model, the initial investment cost to setup a Cafe Rio Franchise will range between $750,000 and $1.5 million with a floor space of at least 3000 sq feet.

The initial investment for the Café Rio Franchise may include a franchise fee of $35,000 and like other food franchises, the brand may levy a royalty and marketing fee of 5% and 2% respectively.

Note: Please note that the mentioned numbers are only for educational purposes. Cafe Rio has yet to embrace the franchise model, and once they announce it, it will be eventually updated in the article as well.

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How much does a Cafe Rio Franchise make?

Since its inception, Cafe Rio has remained a privately-owned company and does not trade on any stock exchange.

In 2004, Bob Nilsen acquired all six Cafe Rio locations, and since then, it has grown into a chain of over 150 restaurants. When looking at its outlet growth pattern, the chain has averaged nearly six new outlets opening every year.

According to its official website, CEO Steve Vaughan, who possesses over 25 years of restaurant industry experience, joined the company in 2015.

Under his leadership, the chain achieved annual system-wide sales of $4 billion, a significant increase from approximately $500 million, all within just 7 years.

Therefore, considering the experience of visionary leaders, exceptional growth in terms of both outlets and the system-wide sales, growing customer base, and over two decade of expertise in operating Mexican Cuisine, Interested franchise candidates can eventually anticipate a net profit margin of approximately 10% to 15%.

What the requirements for the Cafe Rio Franchise? (if offered)

1. First and foremost, one should be financially well-qualified and have good credit to start a Cafe Rio location. Additionally, they should be prepared to invest a minimum of $750,000 to $1.5 million.
2. You need to find a retail space of at least 3000 sq feet for Cafe Rio restaurants, located at high-traffic locations with a plenty of parking space.
3. One must possess excellent communication skills, be customer service-oriented, and value honesty and business ethics to become an approved Cafe Rio outlet owner.
4. Interested franchisees should have passion to work in the Food and Beverages industry and should possess the leadership and financial skills to operate an Cafe Rio Restaurant.
5. One should/or their partner should meet the minimum financial requirement of at least $250,000 in liquid assets to embark on their journey with Café Rio.

What are the alternatives to Cafe Rio Franchise?

There isn’t much reason not to own a Cafe Rio restaurant, except that the opportunity has to be offered by the chain itself.

Considering the fact that Cafe Rio outlets are company-owned and operated business, let’s check out some viable option in the field:

Costa Vida Franchise

Costa Vida is another popular restaurant that offers a menu similar to Cafe Rio. Established in 2003 in Utah, the brand is currently led by CEO Dave Rutter.

Currently, the chain operates nearly 90 outlets across the Utah and other states. In 2005, Cafe Rio accused Costa Vida of recipe theft, and the matter was later resolved in 2007.

While Cafe Rio doesn’t sell its franchises, one can apply for Costa Vida. To become an approved franchise of Costa Vida, one may need to have an initial capital of $659,500 – $1,025,000, including a franchise fee of $30,000.

Chipotle Franchise

Chipotle was founded in 1993 by Steve Ells, and since then, it has opened over 3,100 restaurants across the United States and the international market.

Despite the high demand for its food and franchises, Chipotle continues to operate and expand its outlets under the company-owned concept only.

The chain specializes in serving a diverse range of Mexican-inspired cuisine, and based on its outlet model, Chipotle franchise enthusiasts are expected to make an initial investment of at least $1 million to $2 million (but for that company has to offer its franchises).

Don’t miss to read our in-depth article on same.

Read more: [Ultimate Guide]Can you Own a Chipotle Franchise? – Cost & Profit – Chipotle

How to Get Cafe Rio Franchise?

Currently, it is highly impossible to obtain a franchise of Cafe Rio restaurants. The chain is focused on expanding its outlet presence under the company-owned model itself and has no plans to sell any of its locations.

In case you need more details, you can directly reach out to them at mentioned address.

Official Details

Final Takeaway – Conclusion

Cafe Rio has indeed established itself as prominent player in the Mexican Grill Restaurant industry, and it’s also true that despite of its growing demand and over two decade of successful operations, Cafe Rio is yet to embrace the franchise concept.

The brand is concentrated on expanding its restaurants to other markets under the company-owned model itself.

To conclude, Candidates interested in obtaining a Café Rio restaurants will either have to wait for a few more years or can check out the Mexican-inspired restaurant chains.

Good Luck!! Happy Franchising!!

Want to explore more? Then check out below franchising opportunities.

Food & Beverages Franchise, Bakery Franchise, Home Improvement, Car wash, Real Estate, and Tea & Café Franchise

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