How Much It Costs To Own a Dunkin’ Franchise
The marketing slogan that Dunkin’ uses to entice franchisees is “invest in the name every coffee fan knows.”
It’s actually a pretty fair assessment.
After 70 years of history, Dunkin’ is not shy in pointing out that it has ranked No. 1 among coffee shops in the Brand Keys Customer Loyalty Index for 13 years in a row. With more than 11,000 locations in more than 60 countries — including 8,500 across 41 states in the U.S. — it’s hard to imagine that there’s a bigger name in coffee, doughnuts and breakfast on the go.
The good news for ambitious entrepreneurs who want to get in on the action is that 100% of it is franchisee-owned — but those entrepreneurs had better have the cash to back up the ambition.
What Do I Need To Open a Dunkin’ of My Own?
To even be considered by the Dunkin’ gatekeepers, you have to have a net worth of at least $500,000, depending on your market — and that’s per restaurant. You’ll also need to prove that you have $250,000 in liquid assets.
What Kind of Investment Is Required?
For a traditional location with 1,200 to 2,600 square feet, you’ll have to pay a franchise fee of between $40,000 and $90,000, but it doesn’t stop there. You’ll also have to pay a continuing franchise fee of between 2% and 6%, not to mention a 5% advertising fee — all of those Dunkin’ commercials you see on TV, after all, benefit your location as much as any.
All in all, Dunkin’ estimates your overall investment will be between $526,900 and $1,787,000.
Is There a Cheaper Option?
Non-traditional locations start at 500 square feet. Although the $500,000 minimum net worth requirement doesn’t change, the overall investment is much lower — between $121,400 and $972,800, according to Dunkin’. That includes a franchise fee of $1,000 to $2,250 per year and a 5.9% continuing franchise fee. The 2.5% advertising fee is half of what it is for a traditional opportunity.
If you’re still coming up short but are hoping that Dunkin’ will float you the difference on some sort of payment arrangement, think again. Although the company will be glad to refer you to preferred lenders, Dunkin’ does not offer financing of any kind.
You might have to consider:
- SBA-backed loans
- Business acquisition loans
- Equipment loans and leases
- Real estate loans
In some cases with special circumstances, Dunkin’ might reduce or even defer your initial fees, ongoing fees or both. There are certain benefits available for qualified veterans and you might have a lower per-location investment if you’re franchising multiple locations.
So, What’s In It for Me?
You’ll need to make big bucks to recoup an investment of that size — so the question, of course, is what you can expect to earn once you’re up and running. Dunkin’ doesn’t speculate about what individual franchisees stand to earn; but, if you fill out an application, the company will send you a franchise disclosure document (FDD) that contains information on the profits of current franchisees. According to the franchise development company Fransmart, the Dunkin’ FDD report claims the average franchisee earns $124,000 per year.
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