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Noodles & Company Franchise ProfileRestaurant Franchises > Quick-Service Restaurants |
What Are the Initial Investment Requirements for a Noodles & Company Franchise?
To open a Noodles & Company franchise, potential franchisees should prepare for an initial investment ranging from $621,000 to $2,064,000. This includes a franchise fee of $35,000, along with additional costs such as construction, equipment, and inventory. Franchisees will also need to demonstrate cash reserves of $100,000 to $250,000 and a net worth between $500,000 and $1,500,000 to qualify for ownership. Understanding these financial commitments is crucial for anyone considering this franchise opportunity.
What Are the Ongoing Fees Associated with a Noodles & Company Franchise?
Franchisees of Noodles & Company are required to pay a royalty fee of 5% of their net sales, alongside a marketing fee of 1.25%. These ongoing fees are essential for maintaining brand support and marketing efforts, which can significantly contribute to the franchise's success. It’s important for potential franchisees to factor these fees into their financial planning to ensure sustainable profitability.
What Is the Revenue Potential for a Noodles & Company Franchise?
Noodles & Company franchises show promising revenue potential, with average annual revenues per unit reaching approximately $1,334,085. The median annual revenue is about $1,156,277, while the highest recorded revenue can go up to $2,151,198. This financial performance indicates a strong market presence and demand for their offerings, making it an attractive option for aspiring franchisees looking to enter the restaurant sector.
How Quickly Can You Expect to Break Even with a Noodles & Company Franchise?
Franchisees can anticipate a breakeven period of approximately 12 months, which is relatively quick compared to many other franchise opportunities. This rapid payback period can be appealing for investors, as it suggests a strong return on investment. Additionally, the average EBITDA of $203,206 per year highlights the potential for solid profitability once the business is established. Understanding these timelines can help franchisees set realistic financial expectations.
Noodles & Company 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:
Noodles & Company 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 | 448 | 460 | 470 |
| Net Change YoY | 12 | 10 | |
| Franchised Units | 76 | 93 | 90 |
| Net Change YoY | 17 | -3 | |
| Corporate Units | 372 | 367 | 380 |
| Net Change YoY | -5 | 13 |
Franchise Overview
Noodles & Company is a fast-casual restaurant chain that specializes in a diverse menu of globally inspired noodle dishes, salads, and soups. Founded in 1995, the brand has grown significantly, with a focus on providing fresh, high-quality ingredients and a unique dining experience. With locations across the United States, Noodles & Company aims to deliver a taste of various cultures while ensuring that every dish is made to order.
Investment Requirements
Starting a Noodles & Company franchise involves an initial investment ranging from $621,000 to $2,064,000. This includes a franchise fee of $35,000. Prospective franchisees must also demonstrate a cash requirement of $100,000 to $250,000 and a net worth of $500,000 to $1,500,000, ensuring that they have the financial stability to support their new business venture.
Financial Performance
The average annual revenue per unit for Noodles & Company is approximately $1,334,085, with a median of $1,156,277. This indicates strong revenue potential for franchisees. Notably, the highest reported annual revenue per unit is $2,151,198, showcasing the possibility for significant earnings for well-managed locations.
Operational Insights
Noodles & Company maintains a royalty fee of 5% of gross sales and a marketing fee of 1.25%. This structure helps support brand development and local marketing efforts, allowing franchisees to benefit from a strong national presence while promoting their individual locations effectively.
Breakeven and Payback
Franchisees can expect a breakeven time of approximately 12 months, with an investment payback period also around 12 months. This rapid payback period is appealing for new investors, indicating that with proper management and local market engagement, franchisees can quickly recoup their initial investments.
Growth and Expansion
Noodles & Company has shown consistent growth in its franchised units, increasing from 76 in 2021 to 93 in 2022, before stabilizing at 90 in 2023. The total number of units has also risen, indicating a robust expansion strategy. With a mix of corporate and franchised locations, the brand continues to explore opportunities for growth in new and existing markets.
Frequently Asked Questions
The initial investment for a Noodles & Company franchise ranges from $621,000 to $2,064,000. This includes the franchise fee, equipment, and other startup costs.