Einstein Bagels Franchise Startup Cost, Revenue and Profit Margin
Are you a restaurateur seeking investment opportunities with major restaurant brands? You may want to consider one of the industry leaders in the business; Einstein Bros. Bagels.
This company began business operations in 1995 and only started to franchise 11 years later in 2006.
Headquartered in Lakewood, Colorado, the Einstein Bros. Bagels has grown into a major brand with over 720 units and growing. It has a wide range of products that include coffees and teas, fresh-baked bagels, baked sweets & snacks, cream cheese, and creative lunch items.
These are only a few of its many products sold in all outlets.
Terms of Doing Business
As a prospective franchisee, Einstein Bros. Bagels offers you the opportunity of joining its ranks and operating under a trusted and respected brand name.
However, you’ll need to satisfy all its terms and agreements. These are contained in its Franchise Disclosure Document (FDD) issued during registration.
It is important to note that details of its terms and agreements aren’t static. The franchisor reserves the right to change these whenever it deems fit. As you read on, you’ll find information on its terms of renewal, training program, estimated initial investment as well as other fees involved.
These provide a picture of what to expect when applying for this franchise opportunity. However, to find current details on the Einstein Bros. Bagels franchise opportunity, you’ll need to commence your application process.
The FDD which is issued during this process contains all the information you need.
Terms of Renewal
Having met the franchisor’s financial requirements among other things, you’re allowing owning an Einstein Bros. Bagels for an initial franchise term of 10 years. There’s an opportunity to extend your franchise term.
However, this is hinged on meeting certain requirements.
Before we go further, it’s necessary to provide you with further details on the initial franchise term. Here, the franchise agreement from the time your restaurant opens for business is about 10 years. Also, the initial franchise term from the effective date of the agreement is 11 years.
Under its license agreement, the initial franchise term is 5 years. For airport locations, Einstein Bros. Bagels allows franchisees to operate such outlets for an initial franchise term of 10 years. Having met renewal requirements, renewal of the franchise agreement follows this order;
One added 10-year term, two additional 5-year terms (for license agreement), as well as one additional 10-year term for airport locations.
Einstein Bros. Bagels offers a comprehensive training program for new franchisees. At least two individuals are required per franchise to attend its training program. Franchisees are not only allowed to attend the training program but must also complete it to the franchisor’s satisfaction.
So, how long does this training last? It varies. For training held at the franchisor’s headquarters, the training duration lasts approximately 6 days. This may also be held at a designated training store. The franchisor also has selected restaurants where new franchisees are trained.
At such locations, you’ll be trained for 7 weeks. Additional on-site training is provided upon request by the franchisee. A fee of about $350 per person is required per day of training.
Estimated Initial Investment for a Franchised Restaurant
Several fees are involved and included in the franchisor’s estimated initial investment for a franchised restaurant.
These include construction costs ranging from $210,000 to $310,000, computer equipment & electronic from $26,000 to $54,000 and furniture, fixtures & equipment from $175,000 to $261,000.
There’s more! Signage & graphics fees costs around $10,000 to $50,000, professional fees range from $30,000 to $35,000, initial franchise fee starts at $35,000, while design review fee starts at $2,000. There’s also a real estate leasing fee from $25,000 to $56,250.
More fees under this category include opening inventory, smallware & supplies ranging from $15,000 to $25,000. Initial marketing & promotion starts at $10,000, insurance ranges from $7,500 to $15,000 while training expenses costs around $1,000 to $14,000.
Miscellaneous opening costs ranges from $1,300 to $3,600, business licenses range from $500 to $5,000, security deposits from $4,000 to $10,000 while additional funds for a period of 3 months costs around $12,000 to $50,000. All these fees amount to a total of $564,300 to $935,850.
Initial Investment for a Licensed Restaurant
The franchisor requires that certain fee requirements be met for its licensed restaurant. Details include construction costs within the range of $25,000 to $250,000, furniture, fixtures & equipment within the $50,000 to $200,000 range as well as signage & graphics of about $8,000 to $15,000.
Initial franchise fees range from $10,000 to $12,500, real estate leasing ranges from $8,750 to $45,000. Opening inventory, smallware & supplies falls within the $15,000 to $25,000 bracket. Initial marketing & promotion starts at $2,500 while insurance ranges from $2,500 to $3,500.
There are also training expenses with the $2,500 to $6,000 range. Miscellaneous opening costs range from $1,000 to $2,000, business licenses start at $500 to $5,000, security deposits at $800 to $3,750. Additional fund for 3 months is needed and ranges from $12,000 to $50,000. All of the above fees amount to a total of $138,550 to $620,250.
There are still other fees you’ll incur as an Einstein Bagels franchisee. These include a royalty fee of 5% of gross sales. Marketing contribution starts at 4% of gross sales under its franchise agreement. There’s also a grand opening marketing program fee of about $10,000.
The franchise transfer fee starts at 50% of the then-current initial fee. Interest on overdue amounts is about 1.5% per month on the underpayment. A late fee of 15% of the amount due is also necessary. Costs and attorneys’ fees will vary under circumstances. The same applies to supplier testing.
Audit costs include all expenses associated with legal costs, audits, and reasonable accounting costs. The indemnity fee varies under the circumstances. The re-inspection fee includes an amount not exceeding $1,500.
There are also securities offering and additional training and onsite assistance fees these include $7,500 and 350 respectively among several others.
Apply for This Opportunity
Becoming an Einstein Bagels franchise owner isn’t a complicated process at all. You’ll need to go to its website and carefully fill in your details in its brief franchise application form found in its investment section.
A representative reaches out to you in no time to guide you through the step by step process.
These are the basic details of the Einstein Bagels franchise you can make use of in deciding whether this opportunity is for you or not.
If you have what it takes to own this franchise opportunity, you can begin the application process immediately by contacting the franchisor.