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Description
Investment Icon

What Are the Initial Investment Requirements for a Menchie's Franchise?

To open a Menchie's franchise, you should be prepared for a range of initial investments, which can vary significantly. The total initial investment ranges from $165,110 to $424,571, including a franchise fee of $40,000. Additionally, prospective franchisees need to have a net worth of between $500,000 and $1,000,000 and liquid cash available to cover the initial costs. Understanding these financial commitments is crucial for anyone considering joining the Menchie's family.

Fees Icon

What Are the Ongoing Fees for Menchie's Franchise Owners?

Menchie's franchisees are required to pay ongoing fees to maintain their franchise operations. This includes a royalty fee of 6% on gross sales and a marketing fee of 2%. These fees contribute to the brand's national marketing efforts and support services, helping franchisees to attract customers and grow their businesses. Being aware of these ongoing obligations is essential for effective financial planning and ensuring long-term profitability.

Revenue Icon

How Profitable Is a Menchie's Franchise?

The profitability of a Menchie's franchise can be quite appealing. The average annual revenue per unit is reported at $499,301, with a median revenue of $293,181. While the lowest annual revenue recorded is $140,337, the highest reaches up to $499,301. This range indicates that, with the right management and location, franchisees can achieve significant financial success. Understanding these revenue metrics can help potential franchisees gauge the potential return on their investment.

Breakeven Icon

What Is the Breakeven and Payback Period for Menchie's Franchisees?

For Menchie's franchisees, the breakeven time is approximately 18 months, which means that owners can expect to recover their initial investment within this timeframe if operations run smoothly. The investment payback period is estimated at 26 months, allowing franchisees to start seeing returns on their investment relatively quickly. Knowing these timelines can help franchisees set realistic financial goals and expectations as they embark on their business journey.

Menchie's 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.

Net Worth Required icon The minimum total assets (minus liabilities) you must possess.

i Net Worth Required:

$500,000 - $1,000,000
Investment Payback icon The estimated period to recoup your total investment.

i Investment Payback:

26 Months
Franchise Fee icon The initial fee paid to join the franchise system.

i Franchise Fee:

$40,000
Royalty Fee icon Ongoing percentage of revenue paid to the franchisor.

i Royalty Fee:

6%
Marketing Fee icon Regular contribution toward the franchise’s advertising fund.

i Marketing Fee:

2%
Breakeven Time icon The estimated timeframe to recover your initial costs.

i Breakeven Time:

18 Months
Initial Investment icon The total amount required to launch the franchise.

i Initial Investment:

$165,110 - $424,571
Cash Required icon The minimum liquid capital you must have on hand.

i Cash Required:

$165,110 - $424,571
Average Revenue icon The typical yearly revenue generated per franchise location.

i Average Revenue:

$499,301
Median Revenue icon The middle value of yearly revenue among franchise locations.

i Median Revenue:

$293,181
Highest Revenue icon The largest reported annual revenue among franchisees.

i Highest Revenue:

$499,301
Lowest Revenue icon The smallest reported annual revenue among franchisees.

i Lowest Revenue:

$140,337
Industry icon A broad sector defining similar types of franchise businesses.

i Industry:

Food Franchises
Category icon A more specific division within the broader industry.

i Category:

Ice Cream & Frozen Yogurt
Leadership icon The key individuals guiding the franchise’s strategy and growth.

i Leadership:

Amit Kleinberger
Corporate Address icon The official business address of the franchisor’s headquarters.

i Corporate Address:

17555 Ventura Blvd., #200 Encino, CA 91316
Funding Year icon Available financing options to help start the franchise.

i Funding Year:

2007
Parent Company icon The main organization that owns the franchise brand.

i Parent Company:

BSD USA, LLC

Menchie's Franchise Unit Growth Summary

A breakdown of corporate, franchised, and total units, with yearly net changes.

The overall number of operating franchise locations.

Total Units i

297
The number of locations owned by independent franchisees.

Franchised Units i

296
The number of locations owned and run by the franchisor.

Corporate Units i

1
Units 2021 2022 2023
Total Units 321 318 297
Net Change YoY -3 -21
Franchised Units 320 317 296
Net Change YoY -3 -21
Corporate Units 1 1 1
Net Change YoY 0 0
Investment About

Franchise Overview

Menchie's is a leading self-serve frozen yogurt franchise that has carved a niche in the dessert industry. With an emphasis on quality, variety, and customer experience, Menchie's offers a wide selection of yogurt flavors and toppings, allowing customers to create their own unique dessert creations. Established in 2007, the brand has expanded rapidly, boasting hundreds of locations across the globe, making it a popular choice for aspiring entrepreneurs looking to enter the thriving frozen dessert market.

Potential About

Investment Requirements

To open a Menchie's franchise, potential owners should expect an initial investment ranging from $165,110 to $424,571. This includes a franchise fee of $40,000, alongside ongoing royalty and marketing fees of 6% and 2%, respectively. Additionally, franchisees must have a net worth between $500,000 and $1,000,000, ensuring they have the financial stability to support their business operations.

Metrics About

Financial Performance

Menchie's franchises have demonstrated strong financial potential, with an average annual revenue of $499,301 per unit. The median annual revenue sits at $293,181, while some units report revenues as low as $140,337 and as high as $499,301. This range indicates the potential for profitability, though success may depend on location and management practices.

Fees About

Breakeven and Payback Period

Franchisees can expect to reach breakeven within approximately 18 months of operation. The investment payback period is estimated to be around 26 months, allowing owners to recoup their initial investment relatively quickly compared to other franchise models. This timeline is crucial for potential franchisees to consider when evaluating the financial viability of their investment.

Breakeven About

Operational Insights

Menchie's franchisees face various operational expenses, with total annual expenses averaging around $8,070,327. Key costs include rent ($195,314), salaries and wages ($7,908,684), and utilities ($3,700). Understanding these expenses is essential for franchisees to effectively manage their budgets and optimize profitability.

Units About

Franchise Growth

Menchie's has seen fluctuations in its number of franchised units, with 320 units in 2021, 317 in 2022, and 296 in 2023. This trend reflects the competitive nature of the frozen yogurt market and emphasizes the importance of strong local marketing and customer engagement strategies to maintain growth and attract new franchisees.

Frequently Asked Questions

The initial investment for a Menchie's franchise ranges from $165,110 to $424,571, depending on various factors such as location and size of the unit.