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How Much Does A STARBUCKS FRANCHISE COST [2022 Guide]

Are you wondering how much does a Starbucks franchise cost in 2022? Starbucks can be found almost anywhere you look or shop. Starbucks is widely regarded as the world’s largest coffee chain. It has more than 32,646 locations in 2020 and a continued expansion. From its humble beginnings as a modest coffee shop in Seattle, Starbucks has developed into a multi-national enterprise with more than 70 million loyal customers, both young and old.

Unfortunately, Starbucks doesnt offer franchises. Thus, you wont be able to own a Starbucks store outright. You can become a licensor by opening a Starbucks location. The Starbucks franchise cost or license cost is approximately $315,000. To be eligible for this chance, you’ll also require $700,000 in liquid assets on hand. Starbucks chooses to license to maintain control over its locations and the quality of its products. As a licensee, you would be renting the Starbucks brand in exchange for a licensing fee rather than owning the store in the same way a franchise owner would. Follow this guide to answer your question how much does a Starbucks franchise cost?

Starbucks does have licensed stores, to be sure. Consequently, if you currently own or operate a business that can assist Starbucks in reaching a new audience, you can possibly add a Starbucks-licensed store to your portfolio. This is a somewhat regular occurrence.

How Much Does A Starbucks Franchise Cost?

Every new franchisee who purchases a company’s franchise must make a one-time Starbucks franchise fee paid to the franchisor. This allows them the right to conduct business using the company’s brand name. But, keep in mind that Starbucks doesn’t offer franchises. The only other option is to start a licensed store.

The Starbucks total investment franchisee cost isright around the $400k markand includes furniture, fixtures and equipment (FF&E).

How much does a Starbucks franchise cost? Costs to open a Starbucks franchise/licensed location depending on the location etc. ranges from a low of 400k dollars all the way up to $2million dollars.

Starbucks Revenue per year / Average Sales

Starbucks has generated annual average revenue of $23.69 billion during the past five years. This is one of the reasons why they are known as the “World leader of all Coffee Shops.” Even though they did experience a decrease in sales in the year 2020 due to the pandemic, their sales statistics for the previous five years demonstrate that they have been steadily increasing. As the company develops further into large markets such as the United States, we anticipate that this growth trend will be sustained.

One of the driving forces behind their expansion has been the smartphone app, which currently accounts for an astonishing 24 percent of total sales in the United States. This number climbed from merely 3 percent in 2016, when the company was founded. Customers can earn points when they order drinks or meals through the mobile app, which is available for both iOS and Android devices. These incentives, or stars referred to within the app, can be redeemed for complimentary menu items like a loyalty punch-card scheme.

On a daily basis, how much money does a Starbucks Franchise Owner make?

The amount of money made depends on customer traffic and the items people buy. According to national research conducted in the United States, the average Starbucks owner generates $540,000 in income annually, $45,000 in monthly revenue, and $1,500 in daily revenue. A busier location may generate more sales than the figures shown.

Note: USA Starbucks franchise owners can generate in excess of $1 million dollars annualy.

Note: If you are in a prime location with a ton of foot traffic your earnings can be substantially higher.

How Much Does A Starbucks Franchise Cost – Operational Costs?

Other than the Starbucks franchise cost, there are also operational costs. According to research conducted in the United States, it costs $1,770 per day to operate a single Starbucks outlet, which equates to approximately $646,000 in annual expenses for the coffee chain.

A monthly royalty equivalent to 7% of the Gross Revenue out of every Starbucks Store is due and payable by the Licensee to Starbucks monthly.

How Much Does A STARBUCKS FRANCHISE COST [2022 Guide]How Much Does A STARBUCKS FRANCHISE COST [2022 Guide]
How Much Does A STARBUCKS FRANCHISE COST [2022 Guide]

Starbucks Licensees Should Expect to Pay an Estimated Total Cost

What are Starbucks numbers? It is assumed that you will need to have approximately 676,400 US Dollars in liquid assets to purchase a Starbucks franchise. Starbucks, the world’s largest coffee company, is projected to be worth more than $55.94 billion, with CEO Howard Schultz having an estimated net worth of $2.1 billion.

Steps on How to Acquire a Starbucks License

To obtain a Starbucks license, the prospective licensee must follow the steps outlined below.

  • For information, go to the Starbucks website and search for the icon that says “apply for a license.”
  • To display the drop-down menu, hover your cursor over the icon. Select the company summary that best describes what you have in mind, and click on the “Submit” button.
  • Following that, you would be asked to prepare a formal application in which you would detail your business location, obligations, and assets, as well as the net value of your company and the amount of cash you currently have on hand.
  • Once you’ve submitted your application, you’ll need to wait for a response from the Starbucks staff.

Starbucks does not now provide franchise opportunities, but the corporation has previously offered franchise opportunities. Starbucks built its first franchise location in Liphook, a town in Hampshire’s Eastern division, in March of this year. 

The Benefits of Having a Starbucks Brand License

We are aware that Starbucks is not a franchisable business. Alternatively, you can license a specific location. The following are some of the benefits of taking this approach.

         Designing a Store to Your Specifications

Upon receiving a license to run a Starbucks in the United States, you have the option to design the licensed store to suit your personal preferences. Unlike other franchises, where the corporate dictates the layout and design of the store, with Starbucks, you have the freedom to choose from various strategies appropriate for the local market.

But, this does not preclude you from being entirely original in your design. You’d still have to build your store under one of the 18 design studios that Starbucks would give, which would be an additional cost. It is still preferable to the uniform appearance you will obtain from other business franchises.

         Whole Beans and a Limited-Edition Food Menu

Additionally, you will receive Starbucks’ exclusive baking program in addition to a personalized store design. Their unique beverages are available for purchase, but you also have access to their full range of options. 

You’ll also receive the Starbucks beans, which means you won’t have to worry about where you’ll obtain your supply of coffee to sell when you open your business.

         Ongoing Consultation

Starbucks will not abandon you immediately once you have set up an outlet. All of your questions and concerns will be addressed through consultations and other forms of assistance. It would also be helpful to have experience working in a Starbucks location before purchasing a brand license. This will allow you to become more familiar with the day procedures of a retail store environment.

         Package containing proprietary equipment

Probably you’re pondering how you’ll determine which coffee machine to utilize or what other machinery you’ll require when you obtain a license to open a Starbucks cafe. This is something you won’t have to worry about because they’ll provide you with the equipment that has already been approved for usage by the government. This helps to ensure that your store is consistent with the other coffee shops operating under the same roof.

         The Starbucks Trademark

As a Starbucks licensed store, one of the most significant benefits is that you will have the edge over other coffee shops in terms of sales. Your store’s name is already well-known in the community. You already have a following of customers. Starbucks’s visual identity has already been established for you. You’ll have the iconic coffee line, the merchandising, and seasonal promos such as Pumpkin Spice Lattes to keep your customers coming back. You won’t have to worry about figuring out your brand because you’ll have most of the store ready to go.

Starbucks success of your franchisesStarbucks success of your franchises
Starbucks success of your franchises

Starbucks Brand Licensing Has Its Challenges

Starbucks, like any other business, has its share of obstacles. We’re here to walk you through the process of obtaining a Starbucks license so that you’ll be prepared if and when you decide to go ahead and apply. What you need to know about them is as follows:

         Costly Licensing Charges

Starbucks licensing costs have already been discussed. In addition to the fee, Starbucks will evaluate your application if you have a liquid asset of an appropriate value.

As a result, unless you already have a large national business, it may not be easy to secure a Starbucks license.

Spectacularly Expensive Coffees [ But Delicious ]

Many people think Starbucks is expensive. For a 12-ounce cup of iced coffee at Starbucks, it costs $2.25, whereas, at Dunkin’ Donuts, it costs $1.99. (16 ounces). Several reasons contribute to the high cost of Starbucks coffee. The great locations, popularity, ease of access, and well-trained staff are all factors to consider.

Because of their loyal customer base, Starbucks has been able to stay in business for so long. But, many others would instead buy their coffee someplace else because it is considerably less expensive.

         Location

Sadly, even the best sites come at a price, and Starbucks is no exception to this. Rent would be prohibitively expensive if it were located in an attractive location like a high trafficked shopping center. If it’s on a vacant lot, you’ll have to either rent a portion of it or go through the legal process of purchasing it before you can begin construction on the licensed store.

You’ll be responsible for more than just the licensing charge. Adding a Starbucks to your neighborhood comes with a high Starbucks franchise cost but it can be well worth the price.

Bottom line – Is The Starbucks Franchise Cost Worth It?

Although the Starbucks franchise fee is expensive and the overall Starbucks franchise cost is high, there are a lot of benefits of going down this route.

Starbucks has a raving and super loyal fan base who will walk through walls for their favorite Starbucks coffee and gladly pay a premium price to do so.

Just like Jeep Wrangler owners who are super loyal to the brand the same goes with the tons of loyal Starbucks customers.

So, is the Starbucks franchise cost worth it?

In my opinion, most definitely, 9 times out of 10.

If you have the initial capital and a great Starbucks location in mind then the sky is literally the limit with your new Starbucks franchise.

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