In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the Baskin-Robbins franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Baskin-Robbins franchise, based on Item 7 of the company’s 2021 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Baskin-Robbins franchise, based on Items 5 and 6 of the company’s 2021 FDD
- Section IV – Number of franchised and company-owned Baskin-Robbins outlets at the start of the year and the end of the year for 2018, 2019, and 2020, based on Item 20 of the company’s 2021 FDD
- Section V – Presentation and analysis of Baskin-Robbins’ financial performance representations, based on Item 19 of the company’s 2021 FDD, including information on the:
- average sales by geographic region for continental U.S. Baskin-Robbins single brand restaurants that have been open for business to the public for at least one year during a one-year measuring period from November 1, 2019 to October 31, 2020
- average sales by geographic region for continental U.S. combo restaurants in freestanding and shopping center/storefront locations (separately stated) that have been open for business to the public for at least one year during a one-year measuring period from October 26, 2019 to October 24, 2020
- average cost of goods sold and labor costs by region for continental U.S. Baskin-Robbins restaurants (and separately, for combo restaurants) for the period from November 1, 2019 to October 31, 2020
Section I – Background Information
21 Things You Need to Know About the Baskin-Robbins Franchise
Parent Company Acquired by Inspire Brands
1. In October 2020, Dunkin’ and Inspire Brands struck the largest restaurant deal since 2014, entering into a definitive merger agreement under which Inspire would acquire the coffee giant for $106.50 per share in cash. The transaction was valued at roughly $11.3 billion, including the assumption of Dunkin’ Brands’ debt. It’s the highest-dollar acquisition since 3G Capital LP, Burger King Worldwide Inc., acquired Tim Hortons for $12.64 billion in August 2014. Panera Bread is next at $7.5 billion, a price paid by JAB Holdings in 2017.
2. The $106.50 number represents a premium of about 30 percent to Dunkin’s 30-day volume-weighted average price and a premium of 20 percent per share to its closing price on October 23, before talk of the potential deal surfaced in a Sunday New York Times report. Dunkin’ closed the week trading for $99.71.
3. Paul Brown, co-founder and CEO of Inspire Brands, said, “Dunkin’ and Baskin-Robbins are category leaders with more than 70 years of rich heritage, and together they are two of the most iconic restaurant brands in the world. By joining Inspire, these brands will add complementary guest experiences and occasions to our current portfolio.”
4. Ahead of the blockbuster deal, Roark Capital-backed Inspire’s ascending portfolio included more than 11,000 restaurants across Arby’s, Buffalo Wild Wings, Sonic Drive-In, and Jimmy John’s, with $15 billion in annual systemwide sales. The Dunkin’ acquisition ballooned those figures.
5. At the time of the announcement, there were more than 12,500 Dunkin’ and nearly 8,000 Baskin-Robbins globally. At close, Inspire directed 31,600-plus restaurants in 60-plus countries, with $26 billion in annual systemwide sales. It also employed 600,000 company and franchise team members, 3,200 franchisees, and more than 25 million loyalty members.
6. Inspire said Dunkin’ and Baskin-Robbins will be operated as distinct brands within the company’s portfolio, which is how it has run other chains in the past. Inspire formed in the wake of Arby’s $2.9 billion purchase of Buffalo Wild Wings in 2018. This deal gives it five of the country’s 18 largest quick-service brands. Dunkin’ entered 2019 with 9,630 domestic units; Arby’s had 3,359; Sonic Drive-In 3,526; Jimmy John’s 2,787; and Baskin-Robbins 2,524. Buffalo Wild Wings closed 2019 with 1,215 restaurants – good for sixth overall on the full-service side.
7. The deal also placed four of the top 23 grossing counter-service brands under one umbrella (Baskin-Robbins was 48th). By total systemwide domestic sales in millions as of year-end 2019: Dunkin ($9,220); Sonic ($4,687); Arby’s ($3,885); Jimmy John’s ($2,105); and Baskin-Robbins ($626). Buffalo Wild Wings ranked No. 3 among sit-down chains at $3.7 billion.
8. Inspire said adding Dunkin’ and Baskin-Robbins’ vast footprint would strengthen the company “through their scaled international platform and robust consumer packaged goods licensing infrastructure, as well as add more than 15 million loyalty members.” Dunkin’ is 100 percent franchised and boasts more than 20,000 points of distribution in more than 60 countries worldwide.
9. Dunkin’ CEO Dave Hoffmann said, “[Friday’s] announcement is a testament to our world-class group of franchisees, licensees, employees, and suppliers who have worked together to transform Dunkin’ and Baskin-Robbins into modern, relevant brands. This team’s grit and determination has enabled us to deliver outsized performance and made our brands among the most elite in the quick-service industry.”
10. Hoffmann added, “I am particularly proud of our actions since March of this year. During the global pandemic, we have stood tall. We’ve had each other’s backs and are now stronger than ever. We are excited to bring meaningful value to shareholders who have been with us on this journey and believe that Inspire Brands, a preeminent operator of franchised restaurant concepts, will continue to drive growth for our franchisees while remaining true to all that is unique and special about the Dunkin’ and Baskin-Robbins brands.”
Teams Up with Uber Eats to Expand Delivery Options Nationwide
11. At the end of October 2020, Baskin-Robbins announced that it was adding more contactless delivery options through Uber Eats. With this new collaboration, over 1,600 Baskin-Robbins restaurants across the country became available for delivery through the Uber Eats app and UberEats website. To celebrate, fans who spent $10 or more on Baskin-Robbins through Uber Eats received a $0 delivery fee – no promo code necessary – from October 29 to November 4, 2020.
12. This new delivery option and offer arrived just in time for the Halloween weekend, so fans could enjoy an ice cream treat no matter how they chose to celebrate last year. For those who preferred to dress up their ice cream than take to the streets in their own costumes, new DIY Creature Creations Kits were the perfect activity to keep the kids entertained at home.
13. Nicole Boutwell, director of digital marketing for Baskin-Robbins, said, “We’re excited to bring the convenience of delivery to even more guests who are looking for ways to enjoy their favorite Baskin-Robbins treats at home. As people continue to find comfort in ice cream and sweet treats from our specialty ice cream shops, we’re very excited to team up with Uber Eats to expand our easy ordering and contactless delivery options to our loyal guests nationwide.”
14. Stephane Ficaja, head of Uber Eats for the US and Canada, added, “At Uber Eats, we’re always exploring new ways to bring our customers the food they love, right to their doorstep. That’s why we’re excited to bring together Uber’s speed and reliability and Baskin-Robbins’ 75 years of expertise in ice cream and frozen treats.”
15. The vast majority of Baskin-Robbins stores across the country remain open and have enhanced preventative health and safety measures in place. In an ongoing effort to help keep its guests and restaurant employees safe, Baskin-Robbins limited service to drive-thru, carry-out, and curbside pick-up at select locations, in addition to delivery at participating locations with Uber Eats and DoorDash. Guests can order and pay contactless through the Baskin-Robbins App for a quick, grab-and-go experience.
Company History
16. Baskin-Robbins was founded in 1945 by brothers-in-law Burt Baskin and Irv Robbins in Glendale, California. Robbins had been in the ice cream business his entire life and he helped his father manage their family’s ice cream shop while he was a teenager. Baskin had learned about making ice cream while serving in the military during World War II; Robbins also served.
17. Following the war, both Baskin and Robbins were running their own ice cream shops. Eventually, the brothers-in-law decided to combine their shops and wide array of ice cream flavors into Baskin-Robbins. The number of flavors offered was 31 and the brand now rotates through these 31 flavors throughout the year.
18. Within a few short years, Baskin-Robbins grew to six shops and Baskin and Robbins were ready to franchise the concept. The first franchised location opened in Glendale, California in May 1948. Baskin-Robbins continued to expand around the United States and in 1953, the company hired Carson-Roberts Advertising who recommended adoption of the number 31 as well as the pink (cherry) and brown (chocolate) polka dots and typeface that were reminiscent of the circus. Baskin-Robbins maintained this color scheme and theme for several decades before adopting a more modern design in recent years.
19. Baskin-Robbins was owned by its founders until it was acquired in 1967 (just prior to Burt Baskin’s death) by the United Brands Company (United Fruit). A few years later, the first international stores opened in Japan, Saudi Arabia, South Korea, and Australia. In the 1970s, Baskin-Robbins was sold to J. Lyons and Co. which later merged with Allied Breweries. Then, in 1994, Allied-Lyons merged with Pedro Domecq S.A., becoming Allied Domecq, which also owned Dunkin’ Brands (Dunkin’ Donuts). Dunkin’ Brands became the parent company of Baskin-Robbins following the merger.
20. In August 2012, Dunkin’ Brands became completely independent of the private equity firms that had owned it for years. At the end of 2020, Dunkin’ Brands was acquired by Inspire Brands, which also owns Arby’s, Buffalo Wild Wings, Sonic Drive-In, Jimmy John’s, Rusty Taco, and Mister Donut. Today, there are Baskin-Robbins locations in more than 50 countries.
Entrepreneur’s Franchise 500
21. Baskin-Robbins ranked No. 38 on Entrepreneur’s 2021 Franchise 500 list.
Section II – Estimated Costs
- Please click here for detailed estimates of Baskin-Robbins franchise costs, based on Item 7 of the company’s 2021 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on Baskin-Robbins’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2021 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
Franchised
2018
- Outlets at the Start of the Year: 1,072
- Outlets at the End of the Year: 993
- Net Change: -79
2019
- Outlets at the Start of the Year: 993
- Outlets at the End of the Year: 949
- Net Change: -44
2020
- Outlets at the Start of the Year: 949
- Outlets at the End of the Year: 894
- Net Change: -55
Company-Owned
2018
- Outlets at the Start of the Year: 0
- Outlets at the End of the Year: 0
- Net Change: 0
2019
- Outlets at the Start of the Year: 0
- Outlets at the End of the Year: 0
- Net Change: 0
2020
- Outlets at the Start of the Year: 0
- Outlets at the End of the Year: 0
- Net Change: 0
Section V – Financial Performance Representations (Item 19, 2021 FDD) and Analysis
- Tables 1 and 2 and notes provide financial performance representations that are historical, and that are based on information from existing Baskin-Robbins Restaurants (exclusive of Combo Restaurants, Special Development Opportunity Restaurants, Baskin-Robbins Express, and Restaurants operating under Territorial Franchise Agreements) that have been open for business to the public for at least one year during a one-year measuring period from November 1, 2019 to October 31, 2020.
- Tables 3 to 5 and notes provide financial performance representations that are historical, and that are based on information from existing Combo Restaurants that have been open for business to the public for at least one year during a one-year measuring period from October 26, 2019 to October 24, 2020.
Part 1 – Sales Data (Tables 1, 3, and 4)
- The sales figures are compiled by using historical sales that are reported to Baskin-Robbins by franchisees. Baskin-Robbins has not audited or verified the reports.
- This sales data does not include sales tax.
- Sales in regions with a higher concentration of Restaurants that have been in operation for a substantial period of time tend to have higher sales than regions with a lower concentration of Restaurants that have been in operation for a lesser time period.
- Many of the Restaurants included in this data have been open and operating for several years. These franchisees have achieved their level of sales after spending many years building customer goodwill at a particular location.
- Your sales will be affected by your own operational ability, which may include your experience with managing a business, your capital and financing (including working capital), continual training of you and your employees, customer service orientation, product quality, your business plan, and the use of experts (for example, an accountant) to assist in your business plan.
- Your sales may also be negatively affected if you do not adhere to Baskin-Robbins’ standards and system, including proper equipment layout, design and construction criteria, customer queuing and flow, and local Restaurant marketing.
- Your sales may be affected by Restaurant location and site criteria, including traffic count and which side of the street your Restaurant is located, local household income, residential and/or daytime populations, ease of ingress and egress, seating, parking, the physical condition of your Restaurant, the size of your site, and the visibility of your exterior sign(s).
- Additionally, many of the Restaurants included in the sales figures are freestanding Restaurants or located at the end of a strip center, and if your Restaurant is not, your sales could be substantially lower than the figures in the chart.
- Individual locations may have layouts and seating capacities that vary from the typical location.
- Other factors that could have an effect upon your sales may include guest preferences, competition (national and local), inflation, local construction and its impact on traffic patterns, and reports on the health effects of consuming food similar to that served in the Restaurants, as well as the impact of federal, state, and local government regulations.
- Your sales may be affected by guest preferences for certain menu items over others, changes in the menu, and regional differences in products or product demand, including whether there are products not available to you or your region but sold in other regions. Menus are continually being revised, both adding and discontinuing products and product line extensions.
- Sales may be affected by fluctuations due to seasonality (particularly in colder climates), weather, and periodic marketing and advertising programs. Inclement weather may cause temporary Restaurant closings in some areas.
- The data below reflects historical sales. There is no assurance future sales will correspond to historical sales.
- If you own a Combo Restaurant, you should be aware that many Baskin-Robbins franchisees actively pursue cake sales opportunities. If you do not, your sales may be negatively affected. Additionally, seasonality and weather may significantly affect sales of ice cream and related products.
- Some individual Restaurants’ sales may include wholesale accounts and other distribution outlets, which may not be available to you. Not all of these opportunities have been successful for all participating franchisees.
Part 2 – COGS and Labor Data (Tables 2 and 5)
- “COGS” means the cost of goods sold, including food, beverages, and items served or associated with the food or beverage, such as cups, napkins, straws, bags, plastic utensils, and wrapping paper.
- COGS is stated as a percentage of gross sales excluding sales tax and discounts.
- The cost figures from franchised Restaurants are compiled from individual Restaurants by using cost data that are reported to Baskin-Robbins by franchisees for the monthly periods November 1, 2019 through October 31, 2020. Baskin-Robbins has not audited or verified the reports, nor have franchisees confirmed that the reports are prepared in accordance with generally accepted accounting principles or in accordance with Baskin-Robbins’ definition of COGS.
- Your costs will be affected by your own operational ability, which may include your experience with managing quick service restaurant operations, your experience building and managing an organization, continual training of you and your employees, your business plan, and using experts (e.g., an accountant) to assist in your business plan. Your costs may be negatively affected by not adhering to Baskin-Robbins’ standards and system.
- Many of the Restaurants included in this data have been open and operating for several years. Those franchises may have lower cost percentages due to years of experience managing costs. For new franchisees, COGS percentages may initially exceed those of experienced operators.
- There is no assurance that future costs will correspond to historical costs because of factors such as inflation, changes in menu, and other variables.
- Factors affecting your COGS include, but are not limited to, the price of raw materials; your ability to manage and implement proper controls of waste, ruin, loss, theft, and the portion sizes served to the public; regional differences; temporary shortages; seasonal and weather fluctuations; and fluctuations due to periodic marketing and advertising programs. Additionally, freight charges may be higher in some areas. If the cost of gasoline increases in the U.S., the cost of freight will rise as well.
- The COGS data reflects average Restaurant aggregate costs. Different food and beverage items have different cost percentages. Customer demand for products varies among Restaurants and regions and if your Restaurant sells a high percentage of high cost items, your food cost percentage will be higher than if you have a lower percentage of higher cost items.
- Some franchisees purchase finished products manufactured at another location. The cost of this finished product will vary depending upon the number of Restaurants being serviced by the manufacturing location and other factors. These franchisees may pay more for food costs but may pay less for other items such as labor, equipment, distribution, and rent.
- COGS may be particularly affected by the fluctuations in the price of coffee and certain other items and ingredients.
- Restaurants with lower sales may have higher COGS percentages because of reduced efficiencies and economies of scale, and more waste.
- The retail sales price that you establish will also affect the COGS percentages.
- If you are in a geographic area with fewer Restaurants, you may have higher COGS as a percentage of sales due to less distribution efficiencies.
- “Labor” means crew, management, training, payroll tax, and workers’ compensation.
- Labor is stated as a percentage of gross sales excluding sales tax and discounts.
- The cost figures from franchised Restaurants are compiled from individual Restaurants by using cost data that are reported to Baskin-Robbins by franchisees for the monthly periods November 1, 2019 through October 31, 2020.
- Baskin-Robbins has not audited or verified the reports, nor have franchisees confirmed that the reports are prepared in accordance with generally accepted accounting principles or in accordance with Baskin-Robbins’ definition of Labor.
- Your costs will be affected by your own operational ability, which may include your experience with managing quick service restaurant operations, your experience building and managing an organization, continual training of you and your employees, your business plan, and using experts (e.g., an accountant) to assist in your business plan. Your costs may be negatively affected by not adhering to Baskin-Robbins’ standards and system.
- Many of the Restaurants included in this data have been open and operating for several years. Those franchisees may have lower cost percentages due to years of experience managing costs. For new franchisees, labor cost percentages may initially exceed those of experienced operators.
- There is no assurance that future costs will correspond to historical costs because of factors such as inflation, changes in menu, and other variables.
- Factors affecting your labor include, among other things, the local labor market and any applicable federal or state minimum wage law; pending healthcare legislation, employee turnover, and your operational abilities, including your ability to train and retain employees; your compensation that may be included in labor, which varies among franchisees; menu, product mix, Restaurant layout, your salary and benefits programs, and scheduling. Restaurants must be staffed in accordance with Baskin-Robbins’ standards.
- Restaurants with lower sales may have higher labor cost percentages because of reduced efficiencies and economies of scale, and more waste.
- The retail sales price that you establish will also affect the labor percentages.
- The “Total Number of Restaurants/Combo Restaurants in Sample” in Tables 2 and 5 is a subset of the “Total Number of Restaurants/Combo Restaurants in Sample” in Tables 1, 3, and 4 because not all Restaurants or Combo Restaurants reported COGS and Labor data for the twelve month reporting period.
- All of the Restaurants or Combo Restaurants in Tables 2 and 5 reported at least one month of COGS and Labor data for the twelve month reporting period.
Table 1 – Continental U.S. Baskin-Robbins Single Brand Restaurants, Average Restaurant Sales (for the Period November 1, 2019 to October 31, 2020)
Total
Total Continental U.S.
- Total Number of Restaurants in Sample: 882
- Average Sales: $419,003
West-North
- Total Number of Restaurants in Sample: 245
- Average Sales: $449,408
West-South
- Total Number of Restaurants in Sample: 240
- Average Sales: $478,025
Mountain-West
- Total Number of Restaurants in Sample: 242
- Average Sales: $363,305
East
- Total Number of Restaurants in Sample: 155
- Average Sales: $366,516
Tier 1 (1st 25%)
Total Continental U.S.
- Total Number of Restaurants in Sample: 219
- Average Sales: $628,470
West-North
- Total Number of Restaurants in Sample: 61
- Average Sales: $685,403
West-South
- Total Number of Restaurants in Sample: 60
- Average Sales: $705,703
Mountain-West
- Total Number of Restaurants in Sample: 60
- Average Sales: $546,124
East
- Total Number of Restaurants in Sample: 38
- Average Sales: $545,153
Tier 2 (2nd 25%)
Total Continental U.S.
- Total Number of Restaurants in Sample: 219
- Average Sales: $444,092
West-North
- Total Number of Restaurants in Sample: 61
- Average Sales: $473,282
West-South
- Total Number of Restaurants in Sample: 60
- Average Sales: $503,905
Mountain-West
- Total Number of Restaurants in Sample: 60
- Average Sales: $384,870
East
- Total Number of Restaurants in Sample: 39
- Average Sales: $397,527
Tier 3 (3rd 25%)
Total Continental U.S.
- Total Number of Restaurants in Sample: 220
- Average Sales: $353,126
West-North
- Total Number of Restaurants in Sample: 61
- Average Sales: $376,954
West-South
- Total Number of Restaurants in Sample: 60
- Average Sales: $403,614
Mountain-West
- Total Number of Restaurants in Sample: 61
- Average Sales: $309,305
East
- Total Number of Restaurants in Sample: 39
- Average Sales: $308,280
Tier 4 (4th 25%)
Total Continental U.S.
- Total Number of Restaurants in Sample: 222
- Average Sales: $252,631
West-North
- Total Number of Restaurants in Sample: 62
- Average Sales: $265,016
West-South
- Total Number of Restaurants in Sample: 60
- Average Sales: $298,878
Mountain-West
- Total Number of Restaurants in Sample: 61
- Average Sales: $216,270
East
- Total Number of Restaurants in Sample: 39
- Average Sales: $219,685
Table 2 – Continental U.S. Baskin-Robbins Single Brand Restaurants, Average Cost of Goods Sold and Average Labor Cost (for the Period November 1, 2019 to October 31, 2020)
East
- Total Number of Restaurants in Sample: 143
- Cost of Goods Sold Average: 30.1%
- Labor Cost Average: 26.6%
Mountain-West
- Total Number of Restaurants in Sample: 226
- Cost of Goods Sold Average: 29.4%
- Labor Cost Average: 27.7%
West-North
- Total Number of Restaurants in Sample: 222
- Cost of Goods Sold Average: 29.7%
- Labor Cost Average: 27.2%
West-South
- Total Number of Restaurants in Sample: 229
- Cost of Goods Sold Average: 27.8%
- Labor Cost Average: 25.3%
Total Continental U.S.
- Total Number of Restaurants in Sample: 820
- Cost of Goods Sold Average: 29.1%
- Labor Cost Average: 26.7%
Table 3 – Continental U.S. Combo Restaurants, Average Restaurant Sales (for the Period October 26, 2019 to October 24, 2020) – Freestanding Site Type
Northeast – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 85
- Average Sales: $1,632,245
- Average Sales – Dunkin’: $1,501,745
- Average Sales – Baskin-Robbins: $130,500
Northeast – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 75
- Average Sales: $1,103,270
- Average Sales – Dunkin’: $976,944
- Average Sales – Baskin-Robbins: $126,326
Midwest – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 191
- Average Sales: $1,470,762
- Average Sales – Dunkin’: $1,277,403
- Average Sales – Baskin-Robbins: $195,405
Midwest – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 20
- Average Sales: $816,351
- Average Sales – Dunkin’: $685,093
- Average Sales – Baskin-Robbins: $131,258
South – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 238
- Average Sales: $1,246,238
- Average Sales – Dunkin’: $1,110,343
- Average Sales – Baskin-Robbins: $141,153
South – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 17
- Average Sales: $850,278
- Average Sales – Dunkin’: $721,811
- Average Sales – Baskin-Robbins: $128,467
West – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 12
- Average Sales: $1,222,089
- Average Sales – Dunkin’: $994,281
- Average Sales – Baskin-Robbins: $248,517
West – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: N/A
- Average Sales: N/A
- Average Sales – Dunkin’: N/A
- Average Sales – Baskin-Robbins: N/A
Total Continental U.S. – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 526
- Average Sales: $1,389,594
- Average Sales – Dunkin’: $1,231,838
- Average Sales – Baskin-Robbins: $150,905
Total Continental U.S. – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 113
- Average Sales: $1,015,419
- Average Sales – Dunkin’: $886,619
- Average Sales – Baskin-Robbins: $128,799
Table 4 – Continental U.S. Combo Restaurants, Average Restaurant Sales (for the Period October 26, 2019 to October 24, 2020) – Shopping Center/Storefront Site Type
Northeast – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 20
- Average Sales: $1,467,571
- Average Sales – Dunkin’: $1,368,554
- Average Sales – Baskin-Robbins: $99,016
Northeast – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 258
- Average Sales: $904,375
- Average Sales – Dunkin’: $809,647
- Average Sales – Baskin-Robbins: $94,728
Midwest – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 65
- Average Sales: $1,214,154
- Average Sales – Dunkin’: $1,086,378
- Average Sales – Baskin-Robbins: $129,773
Midwest – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 44
- Average Sales: $859,290
- Average Sales – Dunkin’: $752,068
- Average Sales – Baskin-Robbins: $107,222
South – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 111
- Average Sales: $1,171,172
- Average Sales – Dunkin’: $1,028,024
- Average Sales – Baskin-Robbins: $144,449
South – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 50
- Average Sales: $838,175
- Average Sales – Dunkin’: $721,664
- Average Sales – Baskin-Robbins: $116,511
West – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 13
- Average Sales: $1,167,171
- Average Sales – Dunkin’: $924,565
- Average Sales – Baskin-Robbins: $262,823
West – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: N/A
- Average Sales: N/A
- Average Sales – Dunkin’: N/A
- Average Sales – Baskin-Robbins: N/A
Total Continental United States – Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 209
- Average Sales: $1,212,654
- Average Sales – Dunkin’: $1,072,324
- Average Sales – Baskin-Robbins: $142,374
Total Continental United States – Non Drive-Thru Restaurants
- Total Number of Restaurants in Sample: 354
- Average Sales: $888,572
- Average Sales – Dunkin’: $788,463
- Average Sales – Baskin-Robbins: $100,109
Table 5 – Continental U.S. Combo Restaurants, Average Cost of Goods Sold and Average Labor Cost Stated as a Percentage of Total Sales (for the Period November 1, 2019 to October 31, 2020)
Northeast
- Total Number of Restaurants in Sample: 449
- Average Cost of Goods Sold: 25.5%
- Average Labor Cost: 30.8%
Midwest
- Total Number of Restaurants in Sample: 320
- Average Cost of Goods Sold: 27.3%
- Average Labor Cost: 27.4%
South
- Total Number of Restaurants in Sample: 426
- Average Cost of Goods Sold: 28.7%
- Average Labor Cost: 28.0%
West
- Total Number of Restaurants in Sample: 19
- Average Cost of Goods Sold: 28.9%
- Average Labor Cost: 30.2%
Total Continental U.S.
- Total Number of Restaurants in Sample: 1,214
- Average Cost of Goods Sold: 27.2%
- Average Labor Cost: 28.9%
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FAQs
What are the financial requirements for a potential franchise for Baskin-Robbins? ›
To buy a franchise with Baskin Robbins, you'll need to have at least liquid capital of $100,000 and a minimum net worth of $300,000. They also offer financing via 3rd party as well as a discount for veterans ($2,500 off franchise fee).
How are the periodic royalties calculated and when are they paid for Baskin-Robbins? ›As with most franchises, Baskin-Robbins will require you to pay an ongoing franchise royalty fee, which is a percentage of your store's sales. The fee is 5.9% of gross sales, which you'll pay out to your corporate partner at predetermined time increments (generally monthly or quarterly).
How much does a Baskin-Robbins franchise owner make? ›What is the turnover of a Baskin-Robbins franchise? On average, a Baskin-Robbins franchise makes $289,000 in sales per year. This number is the average of the 2,012 franchises operating in 2022.
How much does it cost to open a Baskin-Robbins? ›Baskin-Robbins Franchise Cost, Initial Franchise and Requirements. The estimated initial investment required to open a Baskin-Robbins ice cream franchise is $94,350 to $402,200, including an initial franchise fee of $25,000.
What are the financial requirements for a potential franchise? ›- Credit score. Minimum credit scores vary by franchisor, but most consider a grade of 680 or higher as ideal.
- Net worth. ...
- Available cash. ...
- Previous industry experience. ...
- Management experience. ...
- Total investment required. ...
- Ongoing costs. ...
- Training and support.
However, if you want a more direct answer, according to franchising industry expert Michael H. Seid, founder and managing director of Michael H. Seid & Associates, the initial investment for a single unit franchise typically falls in the $100,000 to $300,000 range. Why such a large, and truly hard-to-define range?
How often do franchisees pay royalties? ›Franchise royalties are usually collected by your franchisor on a monthly basis. Like marketing fees, these fees are based on a percentage of your revenue.
How much in royalties is paid to the franchisor and how often? ›Royalty Fees Vary
Fees vary by franchisor, but they are typically due every month. The amount that a franchisee pays is usually between 4% and 8% of the franchisee's gross sales each month. But some franchisors calculate it based on net sales (after expenses).
As mentioned before, the ice cream franchise is a profitable business model. While the summer season experiences a peak in profits, ice cream also continues to offer good sales later in the year.
What franchise owner has the highest salary? ›| Percentile | Annual Salary | Hourly Rate |
|---|---|---|
| 90th Percentile | $62,000 | $30 |
| 75th Percentile | $56,000 | $27 |
| Average | $49,588 | $24 |
| 25th Percentile | $43,000 | $21 |
How much does a franchise owner make per store? ›
On average, typical franchisees make about 80,000 dollars a year, not considering tax and expenses. Only a small part of franchise owners make over $200,000 annually, more than fifty percent of franchisees make about $50,000. The industry you're operating in impacts the amount of profit as well.
What are the capital requirements for Baskin-Robbins? ›To become a Baskin-Robbins franchisee, you must pay an initial franchise fee of $25,000. That's on top of an estimated initial investment ranging from almost $300,000 to well over $630,000.
Who are Baskin-Robbins competitors? ›Baskin Robbins's competitors include Havmor Ice Cream, MamaMia!, Cream Stone, Cafe Chokolade. Baskin Robbins ranks 3rd among 22 active competitors.
What is Baskin-Robbins franchise called? ›Franchise Description: The franchisor is Baskin-Robbins Franchising LLC.
What are the three elements of a franchise? ›In short, a business arrangement meets the FTC Rule definition of a franchise if the business arrangement involves: (i) the grant of a trademark, (ii) the franchisor exerts or has the authority to exert significant control or assistance over the operation of the business, and (iii) the franchisee pays the franchisor or ...
What does the franchise fee cover? ›The franchise fee covers the cost of your application, training, initial marketing and advertising, sales commission and general costs incurred by the franchisor's corporate team in getting you all set up.
Is it hard to get financing for a franchise? ›Franchises financing is available, but you'll need to know where to look. While many of the top franchises require a franchisee to have substantial assets and/or net worth, there are plenty that can be purchased for $50,000 or less, and it may be possible to finance all or part of that cost.
How much is a downpayment on a franchise? ›Entrepreneurs looking to finance a franchise transfer typically need to put 20% down, while a new location or start-up business requires 25 – 30% down.
How much is the average initial franchise fee? ›This fee can be any amount above $500 (it must be above $500 to trigger the “payment” element of the FTC Rule). Every franchisor charges a different fee based on their particular business and the industry they're in. Across all franchises, the average initial fee hovers around $25,000 – $50,000.
What is the average profit margin for a franchise? ›The average EBIDTA profit is between 8%-15% of sales. If the volume of sales is low, the percent will be lower. Contrarywise this, the higher the volume, the higher the percentage. Do you know what are the three most important numbers of your business?
What are the monthly royalties for a franchise? ›
When you pay a royalty fee, it is usually collected by the franchisor on a monthly basis and is calculated based on a percentage of the franchise's revenue. Typical franchise royalties range from 4% of your revenue to 12% or more based on the type of franchise business.
What is the average percentage of a franchise fee? ›What are Ongoing Franchise Fees? Franchisors typically calculate a royalty fee as a percentage of your gross revenue. Industry averages range between 4% and 9% of gross sales, but franchisors can establish it at any percentage in the franchise agreement.
Do franchise owners keep all profits? ›As a franchisee, you earn money from the franchise's profits. This means that after your overhead costs are covered, you can draw a salary from the remaining profits.
What royalty fees must be paid to the franchise owner? ›Royalty fees typically range between 5 and 9 percent of the franchisee's gross sales. In some cases, the franchisor may set a minimum amount, which must be paid regardless of whether your business is deriving any revenue.
What percentage of royalties do producers get? ›Most times producers receive a percentage of around 3 to 5% of the record's sale price or 20 to 25% of the artist's share. This can vary depending on the producer and on the recording artist. If the artist is signed to an indie label or is independent, the producer usually takes a higher percentage.
How often should royalties be paid? ›Published authors receive both advances and future royalties income based on book sales. Once books are sold, the book royalties are payable, then paid once or twice a year, according to the publisher, Penguin books.
What is the number 1 franchise in America? ›| Rank | Name | Industry |
|---|---|---|
| 1 | Chick-fil-A | Fast Food Franchises |
| 2 | The UPS Store | Business Services Franchises |
| 3 | Ace Hardware Corporation | Home Services Franchises |
| 4 | McDonald's | Fast Food Franchises |
McDonald's: $37 billion in system-wide U.S. sales. Starbucks: $13 billion in system-wide U.S. sales. Subway: $10.8 billion in system-wide U.S. sales. Burger King: $10 billion in system-wide U.S. sales.
Can a franchise make you a millionaire? ›The bottom line is that while a franchise can make you independently wealthy, it isn't a guarantee. Choosing the right business in the right industry, and going in with preexisting entrepreneurial experience and/or existing wealth can help, but your income-generating potential may still be somewhat limited.
Do franchise owners set prices? ›The ability to control a franchisee's pricing is often set forth in the franchise agreement signed by the franchisor and franchisee. Sometimes, the franchisor reserves the right to determine a franchisee's resale prices. Other times, the franchisee will have ultimate authority over its pricing.
What is the success rate of a franchise? ›
Franchise Success Is Nuanced
Bates looked at more than 20,500 small businesses and found that 65.3% of franchises survived after four years compared to 72% of independent businesses. Retail franchises had a lower survival rate of 61.3% compared to 73.1% of independent retail locations.
- Limited creative opportunities. ...
- Financial information is shared with the franchisor. ...
- Varied levels of support. ...
- Initial investments and start-up costs can be expensive. ...
- Contracts aren't permanent. ...
- You're your own boss, but you have less individual control.
- McDonald's franchisee applicants must have a minimum of $500,000 available in liquid assets and pay a $45,000 franchise fee.
- Those looking to launch a new McDonald's franchise can expect to shell out between $1,314,500 and $2,306,500.
- Existing franchise operations can cost upwards of $1 million.
WHAT ARE THE MINIMUM REQUIREMENTS TO QUALIFY? As a Dunkin' franchisee, you'll need to have $250,000 minimum in liquid assets and a net worth of $500,000 per restaurant, depending on your market. You may also purchase an existing Dunkin' franchise by meeting the minimum financial requirements for your desired market.
What are the financial requirements for a potential franchise Dairy Queen? ›| Franchise Fee: | $45,000 |
|---|---|
| Investment Range: | $1,511,200 - $2,533,400 |
| Liquid Capital Requirement: | $400,000 (for a single unit) |
| Net Worth Requirement: | $750,000 (for a single unit; multi-unit requirements are higher) |
| Certified DQ Managers: | 3 |
The company's hands-on, small business approach allows franchisees to create a strong presence in local communities around the world. By becoming a part of Baskin-Robbins you get a guaranteed return on investment due to their historical performance numbers and internationally recognized brand.
What is a franchise business examples? ›Franchises are an extremely common way of doing business in the U.S. It is hard to drive more than a few blocks in most cities without seeing a franchise business. Examples of well-known franchise business models include McDonald's (NYSE: MCD), Subway, United Parcel Service (NYSE: UPS), and H&R Block (NYSE: HRB).
Which franchise is most profitable? ›- Tumbledry Franchise Store.
- Kalyan Jewellers Franchise.
- Domino's franchise store.
- Dr Lal Pathlab Franchise.
- FirstCry Franchise Store.
- VLCC Franchise Salon.
- Kidzee Franchise.
- Jockey Franchise Store.
If a franchisee is ever in financial distress then the franchisor may also help directly as well. A franchisor may waive certain fees or offer special deals on products and supplies for a short time period.
How much do franchise owners make? ›On average, typical franchisees make about 80,000 dollars a year, not considering tax and expenses. Only a small part of franchise owners make over $200,000 annually, more than fifty percent of franchisees make about $50,000. The industry you're operating in impacts the amount of profit as well.
What is franchise royalty fee? ›
It's a royalty. Franchise royalties are usually collected by your franchisor on a monthly basis. Like marketing fees, these fees are based on a percentage of your revenue. But there's one major difference; the percentages are higher. Franchise royalties range from 4% of your revenue all the way up to 12% or more.
Is there a net worth requirement for a franchisor? ›The requirements vary by brand, but there is no skirting the net worth requirements imposed by many franchisors. Your success is important to their reputation, and the need for a certain level of financial liquidity will affect your success and the franchisor's ability to continue selling franchises.