Dutch Bros Franchise Startup Cost, Revenue and Profit Margin
If you’re thinking about investing in a major restaurant chain serving retail coffee and beverages, the Dutch Bros franchise should be among your top picks. Since it started its operations in February 1992, Dutch Bros has witnessed significant growth with over 379 and counting.
With annual revenues over $494,000, it presents a unique opportunity for investors seeking to become a part of the Dutch Bros family. The main products sold by this franchisor include made-to-order beverages, whole bean coffee beverages, merch smoothies, energy drinks, and bottled beverages among others.
Dutch Bros is the largest privately held drive-thru coffee company in the United States. Its operations are firmly established in the West Coast with new locations spreading across the US.
How Much Can I Make as a Dutch Bros Franchisee?
One of the most common and important questions asked by prospective or new franchisees has to do with the earning potential.
Dutch Bros. is a major restaurant and coffee brand known for its steady growth over the years. It also has a growing franchise network to show.
However, the earning potentials for new or existing franchisees aren’t easily predicted. It boils down to many factors such as the size of your franchise, your location, and how efficient and effective you run your operations.
Certain locations cater to a larger volume of clients than others. Also, bigger Dutch Bros franchise outlets typically have more capacity and cater to a wider customer base. More important is how your operations are structured.
By cutting down on operational costs through effective management, you can increase sales while reducing your overhead costs or the cost of doing business. This ends up impacting your overall earnings.
As all franchise opportunities, Dutch Bros has a set of requirements for prospective franchisees. These must be met to be considered as its franchisee. Here, the Franchise Disclosure Document (the FDD) comes into play.
Dutch Bros has a set of detailed requirements that all franchisees must abide by. The FDD contains the full franchise agreement and includes an extensive discussion on all aspects of its requirements. These range from its capital requirements, franchise fees as well as ongoing royalties.
Other key elements include marketing expenses, site selection requirements, financing options, litigation, site building-out costs, training programs & costs as well as Dutch Bros’ historical financial performance.
Additional elements within its (Dutch Bros) FDD include bankruptcy filings, key executive biographies, outstanding lawsuits as well as earning performance, etc. These are key information that needs to be fully digested and understood before signing the franchise agreement.
We recommend that you seek legal help when going through the FDD as it contains a lot of legal terminologies that could easily be confusing.
One of the primary considerations for prospective franchisees has to do with meeting the franchisor’s financial requirements. Now, such requirements vary depending on the size of the franchise you seek to own.
Prospective Dutch Bros franchisees are required to have a net worth of at least $500,000. This also includes a sum of about $125 in cash. The franchise fee starts at $30,000 and must be paid up-front. Royalty fees include 5% of gross sales.
As mentioned earlier, the finer details of this financial requirement are contained in its FDD which is issued during the application process.
Support is an essential part of Dutch Bros franchise operations. This franchisor ensures its new and existing franchisees get all the help they need to succeed. As such, the support offered covers marketing and training all provided on an ongoing basis.
Before your first outlet is opened, training commences immediately the franchise agreement is signed and finalized. This process goes on as the franchise outlet is being set up. The period or duration of training is determined by the franchisor.
Such training is offered at different times during your franchise ownership term. First, there’s the initial training offered to new franchisees who’ve just joined the Dutch Bros family. The training is provided to orient new franchisees about the workings of Dutch Bros restaurants.
On-the-job training is included in Dutch Bros’ initial training for new franchisees. Here, you get to learn the ropes on running a standard outlet and how to offer services that meet and even exceed the client’s expectations.
As a drive-thru beverage shop, time is a valuable asset and must be fully utilized in running its business operations. All of these skills are handed down during hands-on training. Franchisees and managers are mostly required for such training.
Training on request is also available. Here, an additional training fee must be paid by the franchisee for each participant. Professionals are sent or designated from the franchisor for such training programs.
The franchisor decides on the location for such training. In most cases, it may either be offered at Dutch Bros’ corporate headquarters in Oregon or selected franchise partner outlets. There are also ongoing training.
To adapt its operations to new industry trends and changing customer behavior, Dutch Bros offers ongoing training to all its franchisees. This helps significantly in keeping its entire operations running effectively.
Marketing is a vital area of its operations. As such, Dutch Bros ensures that it gives all the marketing support it can offer to all its franchisees. Effective marketing will positively impact sales. Therefore, the key marketing support areas are covered.
These include regional advertising and grand opening ceremony amongst others. By increasing the visibility of your franchise outlet, you tend to attract higher sales while using a proven and tested operational model.
Applying for this Franchise
In your bid to become a Dutch Bros franchisee, you only need to proceed by visiting the franchisor’s website and filling its brief online form. This allows for easy reach as a franchise representative contacts you for further discussions on how to proceed.
Dutch Bros franchise does not directly offer financing support. However, its relationship with third party sources increases your chances of getting access to financing. However, much will depend on meeting certain requirements.
Our discussion so far has been centered on the Dutch Bros franchise.
Here, we’ve covered the basic information needed to make the move. As long as you meet its requirements, you can start the process of owning this franchise opportunity by contacting the franchisor.