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Cinnaholic Franchise ProfileRetail Franchises > Specialty Retail |
What Are the Initial Investment Requirements for a Cinnaholic Franchise?
To open a Cinnaholic franchise, you need to prepare for an initial investment ranging from $241,082 to $526,582. This includes a franchise fee of $40,000, which grants you access to the Cinnaholic brand and business model. Additionally, you must have at least $40,000 in cash readily available and a net worth of $250,000. Understanding these financial commitments is crucial before embarking on your franchise journey.
What Are the Ongoing Fees Associated with a Cinnaholic Franchise?
Cinnaholic franchisees are required to pay a royalty fee of 5% on gross sales, along with a 2% marketing fee. These ongoing fees contribute to the brand's marketing efforts and support systems, ensuring that franchisees benefit from a recognized brand presence. It’s important to factor these costs into your financial planning to maintain profitability while operating your franchise.
What Is the Average Revenue Potential for a Cinnaholic Franchise?
Cinnaholic franchises have demonstrated strong revenue potential, with an average annual revenue of approximately $375,100 per unit. The median annual revenue stands at $350,797, indicating that many franchisees are successfully generating significant income. However, it's essential to note the wide range of revenue performance, with the lowest annual revenue recorded at $16,496.59 and the highest at $730,039.27. Understanding these figures can help you set realistic financial expectations.
What Is the Breakeven and Payback Period for a Cinnaholic Franchise?
Franchisees can expect to break even within 12 months of operation, which is a promising indicator of the business's potential profitability. Additionally, the investment payback period is also estimated at 12 months, suggesting that franchisees can recoup their initial investment relatively quickly. This rapid return on investment is an attractive feature for aspiring entrepreneurs looking to enter the franchise market.
Cinnaholic Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
Cinnaholic Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2021 | 2022 | 2023 |
|---|---|---|---|
| Total Units | 52 | 67 | 81 |
| Net Change YoY | 15 | 14 | |
| Franchised Units | 51 | 65 | 80 |
| Net Change YoY | 14 | 15 | |
| Corporate Units | 1 | 2 | 1 |
| Net Change YoY | 1 | -1 |
Company Background
Cinnaholic is a gourmet cinnamon roll franchise that specializes in creating customizable, plant-based cinnamon rolls. Founded in 2010 in Berkeley, California, Cinnaholic has rapidly grown in popularity, attracting a diverse customer base with its unique offerings. Each roll can be tailored with a variety of frosting flavors and toppings, making it a delightful treat for all ages. The brand emphasizes quality ingredients and innovative flavors, positioning itself as a standout in the dessert market.
Franchise Opportunity
Investing in a Cinnaholic franchise offers aspiring entrepreneurs a chance to be part of a rapidly expanding brand with a proven business model. With a low initial investment range of $241,082 to $526,582, franchisees can tap into a growing market for gourmet desserts. The franchise provides comprehensive support, including training and marketing resources, to help franchisees establish and grow their businesses. Cinnaholic's unique product offering and strong brand identity create an enticing opportunity for those looking to enter the food service industry.
Financial Requirements
To become a Cinnaholic franchisee, a cash requirement of $40,000 and a net worth of $250,000 are necessary. The initial franchise fee is set at $40,000, with ongoing royalty fees of 5% on gross sales and a marketing fee of 2%. These financial requirements ensure that franchisees have the necessary capital to successfully launch and operate their business while benefiting from the support and resources provided by the franchisor.
Performance Metrics
Cinnaholic franchises have demonstrated strong financial performance, with an average annual revenue of approximately $375,100 per unit. The median annual revenue stands at $350,797, indicating a solid earning potential for franchisees. Notably, some units have reported revenues as high as $730,039, showcasing the opportunity for growth within the franchise system. With a breakeven time of just 12 months, franchisees can expect a quick return on investment.
Operational Insights
Cinnaholic units typically incur operating expenses that align with industry standards. Key expenses include rent (approximately $60,000), utilities ($12,000), and marketing ($50,000). Total annual operating expenses are estimated at $219,000, which is manageable given the revenue potential. Franchisees benefit from the franchise's operational support, which helps streamline processes and optimize profitability.
Growth and Expansion
Cinnaholic has shown impressive growth, increasing from 51 franchised units in 2021 to 80 in 2023. This expansion reflects the brand's successful market entry strategy and strong consumer demand. The franchisor is focused on strategic growth, providing franchisees with the tools and support needed to thrive in various markets. With a commitment to innovation and customer satisfaction, Cinnaholic is poised for continued success in the dessert industry.
Frequently Asked Questions
The initial investment for a Cinnaholic franchise ranges from $241,082 to $526,582, which includes the franchise fee, equipment, and other startup costs.