Auntie Anne’s Franchise Costs $421K (+ 2023 Costs & Profits)
This article was updated with the 2023 Franchise Disclosure Document
With over 2,000 stores worldwide, Auntie Anne’s is undeniably one of the most famous pretzels franchises. With annual sales of $737,000 on average in the US, is it worth investing in a Auntie Anne’s franchise?
The good news: as a franchisee it would cost you (only) $421,000 to start a new Auntie Anne’s franchise on average.
So is this really worth it? How much profits can you really make with this business? Are Auntie Anne’s franchises good investments for a franchisee? Let’s find out!
Key stats
| Franchise fee | $35,500 |
| Royalty fee | 7.0% |
| Marketing fee | 5.0% |
| Investment (mid-point) | $421,000 |
| Average sales | $737,000 |
| Sales to investment ratio | 1.7x |
| Payback period | [franchise_value_investment_payback] |
| Minimum net worth | $300,000 |
| Minimum liquid capital | $100,000 |
Compare Auntie Anne’s vs. 1,000+ franchises
Investment, turnover, royalties, profits and more
What is Auntie Anne’s?
Auntie Anne’s is an American chain of pretzel shops with over 2,000 stores in the US and 30 other countries. It serves freshly baked soft pretzels, dips, and other related foods and beverages.
A subsidiary of Focus Brands Inc., headquartered in Atlanta, Georgia, the chain was founded in 1988 in Pennsylvania when Anne F. Beiler (Auntie Anne) and her husband bought a stand in a Pennsylvania farmer’s market.
Auntie Anne’s began franchising in 1989, with its first international location opening in Jakarta, Indonesia, in 1995.
Auntie Anne’s franchise: pros and cons
Operating an Auntie Anne’s franchise has its advantages and disadvantages.
Pros
- Comprehensive Training: The franchisor offers extensive training to franchisees and their employees consisting of 48 hours of classroom training and 24 to 64 hours of on-the-job training. The training includes operations training, marketing, HR, general business practices, and pretzel rolling skills. The franchisor trains franchisees at the same level to ensure a consistent and uniform brand.
- Unique and evolving products: To differentiate itself from its competitors, the brand makes freshly hand-rolled pretzels from scratch on the site and sells them within 30 minutes of being baked. The brand also keeps innovating and creating new products to keep up with industry trends and customer tastes.
- Solid franchise support: To help new franchisees grow and become profitable, Auntie Anne offers them maximum support. Franchisees get support in various fields, such as food and beverage operations, administration, and finance.
- Strong Brand Recognition: Auntie Anne’s brand has stores in all 50 states of the US and globally. In addition, its restaurants are located in high-traffic places such as malls, airports, train stations, and universities.
- Strategic marketing and advertising: The franchisor offers its franchises superb support in research and innovation, as well as professional marketing and promotional campaigns.
- Growth opportunity: The Auntie Anne’s franchise has steadily grown in the last 30 years, currently having over 2,000 stores globally. Franchisees can join a fast-growing brand and easily penetrate new markets. Currently, the brand has opportunities for expansion in locations such as Bristol, Central London, and Scotland.
- Central supply chain: To make sure franchisees enjoy controlled and regulated supplies, the franchisor ensures food products, packaging, cleaning products, and small wares are ordered online from one supply chain at competitive commercial rates.
Cons
- No financial assistance: Auntie Anne’s does not offer any direct or indirect financing to its franchisees for trade fixtures, opening inventory, or any other purpose. It also does not guarantee them any lease, grant, or note.
- No territory protection: The franchisor does not offer franchisees any exclusive territory protection. It only grants franchisees the right to manufacture and sell the franchisor’s products from a specific shop and location approved by the franchisor.
- No absentee ownership: Auntie Anne’s is not a good option for investors looking for absentee business management. Franchisees must be involved or appoint a representative to undertake decision-making and daily restaurant operations.
How much does an Auntie Anne’s franchise cost?
You would need to invest around $421,000 to open an Auntie Anne’s franchise.
This investment amount is an average that can vary based on the type of restaurant. For example, you would pay twice as much for a Auntie Anne’s shop vs. a concession shop:
In addition to the initial franchise fee ($10,500-$35,500), the investment covers a number of startup costs such as:
- Build costs: construction (truck or trailer in case of concession shop), permitting, millwork, equipment, furniture, menu board, graphics, interior signage, exterior signage, computer system, architect/engineer, legal and accounting fees, etc.
- Operating expenses: opening inventory, miscellaneous opening costs, insurance, travel & living expenses while training, additional funds for 3 months as working capital, etc.
Compare Auntie Anne’s vs. 1,000+ franchises
Investment, turnover, royalties, profits and more
How much can you make with a Auntie Anne’s franchise?
On average, an Auntie Anne’s franchise makes $737,000 in sales per year. This is the weighted average of median sales for all enclosed mall franchises (493), outlet center franchises (96), airport franchises (30), and Cinnabon co-branded franchises (54).
How profitable is a Auntie Anne’s franchise?
On average, a Auntie Anne’s franchised restaurant makes $96,000 in profits per year (13% EBITDA margin).
Note that Auntie Anne’s doesn’t provide any detailed information about the financial performance of its franchises in its latest Franchise Disclosure Document. Instead we had to make assumptions which we have summarized below.
| Profit and loss | Amount | % Sales |
|---|---|---|
| Sales | $737,030 | 100% |
| COGS | $(184,257) | 25% |
| Gross Profit | $552,772 | 75% |
| Labor | $(213,739) | 29% |
| Marketing and royalty costs | $(88,444) | 12% |
| Occupancy | $(66,333) | 9% |
| Other OpEx | $(88,444) | 12% |
| EBITDA | $95,814 | 13% |
Is Auntie Anne’s franchise a good investment?
Auntie Anne’s is a great investment from a financial standpoint (to us at least).
Why? We estimate that Auntie Anne’s franchises have a 4 years payback (on average). In other words, you would repay the initial investment of $421,000 within 4 years on average by using the profits generated by the business.
Compare Auntie Anne’s vs. 1,000+ franchises
Investment, turnover, royalties, profits and more
Disclaimer
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