How Much Is It To Start A Starbucks Franchise – Thinking of investing in a Starbucks franchise? If so, you may be wondering how much it will cost and what kind of return you can expect.
In this blog post, we’ll look at the costs and fees of opening a Starbucks franchise, as well as some income statistics. Armed with this information, you can make a more informed decision about whether a franchise is right for you. Thanks for reading!
How Much Is It To Start A Starbucks Franchise
Starbucks is one of the world’s most recognized brands across the food and beverage industry. However, many may be surprised to learn that Starbucks does not operate as a traditional franchise model.
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While Starbucks has certainly changed the way people think about getting a cup, the company chooses to directly own and operate Starbucks stores instead of handing them over to potential franchisees looking to invest in the Starbucks brand. does
However, Starbucks assigns its trademark rights to a Starbucks-licensed store, giving store owners autonomy while Starbucks remains firmly in control of Starbucks coffee-making standards and processes.
Starbucks is a global coffee powerhouse and one of the most recognized brands in the world. But who actually owns Starbucks? Interestingly, it has no corporate parent company. Instead, it is part of an innovative three-tier ownership structure that is relatively unique among large corporations.
The system was created by Starbucks Corporation, which licenses its brand and operates retail stores; Starbucks Coffee Company, a wholly owned subsidiary of Starbucks Corporation, primarily purchases and roasts coffee beans and provides retail support services; and its parent company, Ethos Brands LLC.
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In 2020, Ethos was acquired by Japanese conglomerate Yasumi Emoto Holdings Ltd., making it the company’s major shareholder. Despite the change in ownership, there was no visible disruption to the company’s core business – proving just how successful this multi-level ownership structure has been.
Many people who are familiar with the world famous Starbucks may be surprised at how large their footprint is. The answer to the question is surprising: As of February 2020, Starbucks has 34,879 coffee shops in 81 countries around the world.
In the years to come, this number will only increase – proof that Starbucks’ success and popularity is recognized around the world. With so many impressive locations around the world, one can easily find their favorite coffee nearby!
The cost of opening a licensed Starbucks store can vary based on a number of factors, including location, store size and other costs.
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According to a disclosure document filed by Starbucks in 2020, the total initial investment for a traditional Starbucks coffee shop could range from $228,620 to $2,888,700.
This includes various costs such as building and construction costs, equipment and signage, initial inventory and training costs. It is worth noting that these estimates do not include real estate costs, which may vary from location to location.
Starbucks franchise fees are no longer required when the company transitions from a traditional Starbucks franchise to corporate ownership with multiple licensed stores.
The franchise fee for Starbucks was $40,000 when the company still franchised its stores. However, this is no longer in effect, so it is no longer counted as owned by a Starbucks store.
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Starbucks licensed stores must pay a license fee. The average license cost to open a Starbucks is a license fee of $315,000 and a minimum net worth of $700,000.
Owning and operating any business involves risk and reward. If you were to open a Starbucks, the potential rewards are high, but so are the risks.
Current Starbucks franchise owners report that profits can range from $50,000 to $200,000 per year, depending on how well they are managed. Average revenue per store is approximately $1.2 million.
All in all, with proper management and dedication to developing your own business model that works well, you can potentially make a huge profit.
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Unfortunately, Starbucks no longer franchises its stores. While they did this years ago and high-profile athletes like Magic Johnson were able to join, the option to purchase a Starbucks franchise is not currently available. Although Starbucks cannot be franchised, there are potential licensing opportunities.
Many locations of Starbucks licensed stores are in airports, hotels, retail stores, etc. However, stand-alone stores and stores in metropolitan areas are almost entirely owned by Starbucks.
Given that Starbucks is the world’s largest coffee chain and is publicly traded, we can gain some insight. Therefore, the revenue and initial investment estimates are given above.
If Starbucks ever franchises in the future, this will definitely be an opportunity, but for now, check out other big up and coming coffee franchises like Dunkin’ Donuts, Tim Hortons, and Bigby Coffee!
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Owning a Starbucks franchise is no longer an option, but there are still many opportunities to own and manage a coffee franchise. With the right management skills and dedication to improving the business model, you can earn up to $200,000 a year with a coffee shop.
Before investing in any type of franchise opportunity, it is important that potential entrepreneurs thoroughly research their options to make the best possible decision. By understanding the costs involved and researching other large or upcoming coffee shop chains, potential owners will have all the information they need before taking any such action. good luck!
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Starbucks does not technically offer franchises, as all of the brand’s worldwide stores are company-owned. But if you’re interested in a Starbucks franchise, you’re out of luck.
The company licenses some of its stores, which is functionally similar to a franchise owner. Even better, the potential for a Starbucks license is quite high. Of the more than 35,000 Starbucks stores worldwide, 17,458, or about 49%, were licensed in 2023. If you choose to go this route, there are some costs and hurdles to consider. .
The average cost of licensing a Starbucks store is $315,000. You’ll also need $700,000 in liquid assets to do the math.
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The idea for Starbucks to license its stores instead of franchising them came from its CEO, Howard Schultz. The progressive and popular founder has long believed that the intricacies of providing customers with a quality Starbucks experience—from the presentation of its products to the actual presentation and operation of stores—were handled by the company itself. As such, franchising is not part of the company’s business model.
But the philosophy does not end there. The Company also uses its own licensing model, subject to certain requirements, with the aim of increasing the Company’s sales. In particular, it does not offer a license to anyone who applies. Instead, the company only accepts licensees who currently have growing businesses in good locations that Starbucks can benefit from. For example, the company is actively seeking to add licensed Starbucks locations in the following types of existing industries:
Reading through the list, it becomes clear how sensible Starbucks’ model is. Adding a Starbucks to a high-traffic business or university destination, or a hotel in a popular tourist destination, is a surefire way to generate additional revenue for a business. In addition, the company has the added advantage of working with a licensee who already has a proven track record in managing the company.
For a start-up fee and running costs, Starbucks helps licensees run successful businesses. After all, this is why the company does not offer franchises
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