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How Profitable are Auntie Anne’s Franchises in 2023?

With over 2,000 stores worldwide, Auntie Anne’s is undeniably one of the most famous pretzels franchises. With annual sales of $343,135 on average in the US, it’s a rather small business compared to other restaurant franchises.

But the cost is also very low too: as a franchisee it will cost you on average (only) $229,692 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 fee7.0%
Marketing fee5.0%
Investment (mid-point)$421,000
Average sales$737,000
Sales to investment ratio1.7x
Payback period*5 years
Minimum net worth$300,000
Minimum liquid capital$100,000
* using 15% net profit margin
Auntie Anne's franchise business plan template

Auntie Anne’s Franchise Business Plan

All the stats: startup costs, profits, breakeven, etc.

5-year financial projections built with the FDD

Excellent 4.8/5 based on 70 reviews

Excellent 4.8/5 based on 70 reviews

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 expensesopening inventory, miscellaneous opening costs, insurance, travel & living expenses while training, additional funds for 3 months as working capital, etc.
Auntie Anne's franchise business plan template

Auntie Anne’s Franchise Business Plan

All the stats: startup costs, profits, breakeven, etc.

5-year financial projections built with the FDD

Excellent 4.8/5 based on 70 reviews

Excellent 4.8/5 based on 70 reviews

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, an Auntie Anne’s franchise makes $54,960 in profits per year. That means you may expect a 16% adjusted EBITDA margin

Does this mean you can keep 16% of your sales? No, rather, you may need to deduct taxes, debt interest expenses, and other costs.

The 16% adjusted EBITDA margin is very low compared to similar franchises as per our intelligence (~25-27% industry average for franchise restaurants). This is mainly due to expensive rent costs respective to sales (21% of sales vs ~8% industry average).

Note that to calculate this number we had to use industry benchmark numbers for COGS (25% sales) and labor costs (29%). Indeed, unfortunately, Auntie Anne’s doesn’t provide any financial information regarding costs.

Profit-and-lossAmount ($)As % of sales
Sales$343,135100%
COGS$(85,784)25.0%*
Labor$(99,509)29.0%*
Rent$(72,000)21.0%
Royalty + marketing fees$(30,882)9.0%
Adjusted EBITDA$54,960~16%
* industry average

Is Auntie Anne’s franchise a good investment?

Even though the annual profits are rather low vs. other franchises ($54,960 adj. EBITDA margin, ~16% sales), Auntie Anne’s is a good investment from a financial standpoint.

Why? Simply because its startup costs are rather low too. Indeed, as we just saw the investment to start a Auntie Anne’s franchise is about $229,692 on average, much lower than other restaurant franchises. Indeed, the average investment is $1.4 million for fast food and restaurant franchises in the US, as per our intelligence.

This means that, if we were to consider that you would earn a 12% net profit margin (after all expenses have been paid for, unlike EBITDA), the payback period is 5.6 years, which is average.

In other words, you would need to wait 5.6 years to recoup your original investment of $229,692.

Auntie Anne's franchise business plan template

Auntie Anne’s Franchise Business Plan

All the stats: startup costs, profits, breakeven, etc.

5-year financial projections built with the FDD

Excellent 4.8/5 based on 70 reviews

Excellent 4.8/5 based on 70 reviews

How does it compare vs. other franchises?

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Dunkin' Donutshttps://sharpsheets.io/blog/dunkin-donuts-franchise-costs-profits/Donuts779,0001,056,5211.44.9500,000250,000
Domino'shttps://sharpsheets.io/blog/dominos-franchise-profits-costs/Pizza398,7251,286,4283.23.9250,00075,000
Krispy Kremehttps://sharpsheets.io/blog/krispy-kreme-franchise-costs-profits/Donuts824,0003,400,0004.11.62,000,000300,000
Little Caesarshttps://sharpsheets.io/blog/little-caesars-franchise-costs-profits/Pizza1,022,850798,1130.88.5350,000150,000
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Steak 'n Shakehttps://sharpsheets.io/blog/steak-n-shake-franchise-costs-profits/Burger, Milshakes815,6261,346,3321.74.01,500,000500,000
Crumbl Cookieshttps://sharpsheets.io/blog/crumbl-cookie-franchise-cost-profits/Sweets507,2241,582,0903.12.1300,000150,000
Taco Bellhttps://sharpsheets.io/blog/taco-bell-franchise-costs-profits/Mexican462,4131,650,0003.61.91,500,000750,000
Popeyeshttps://sharpsheets.io/blog/popeyes-franchise-costs-profits/Chicken1,095,7831,444,6171.35.11,000,000500,000
Smoothie Kinghttps://sharpsheets.io/blog/smoothie-king-franchise-costs-profits/Smoothie688,108573,2690.88.0300,000100,000
Jersey Mike'shttps://sharpsheets.io/blog/jersey-mikes-franchise-costs-profits/Sandwich574,3231,220,5862.14.7300,000100,000
Nothing Bundt Cakeshttps://sharpsheets.io/blog/nothing-bundt-cakes-franchise-costs-profits/Sweets538,6501,307,2802.42.7600,000150,000
Jimmy John'shttps://sharpsheets.io/blog/jimmy-johns-franchise-costs-profits/Sandwich513,650874,8451.73.9300,00080,000
Texas Roadhousehttps://sharpsheets.io/blog/texas-roadhouse-franchise-costs-profits/Steakhouse4,209,5002,955,5340.79.5n.a.200,000
Kung Fu Teahttps://sharpsheets.io/blog/kung-fu-tea-franchise-costs-profits/Bubble tea250,125353,2371.44.7n.a.25,000
Wendy’shttps://sharpsheets.io/blog/wendys-franchise-cost-profits/Burger1,374,8331,791,2311.35.11,000,000500,000
Burger Kinghttps://sharpsheets.io/blog/burger-king-franchise-costs-profits/Burger1,242,9501,215,9701.06.81,500,000500,000
Sonic Drive-Inhttps://sharpsheets.io/blog/sonic-drive-in-franchise-costs-profits/Burger1,467,0831,617,0001.16.01,000,000500,000
Panera Breadhttps://sharpsheets.io/blog/panera-bread-franchise-costs-profits/Sandwich2,290,5002,599,4321.15.97,500,0003,000,000
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KFChttps://sharpsheets.io/blog/kfc-franchise-costs-profits/Chicken1,802,0501,567,4740.97.71,500,000750,000
Arby’shttps://sharpsheets.io/blog/arbys-franchise-costs-profits/Sandwich1,184,9751,126,2631.07.01,000,000500,000
Dairy Queenhttps://sharpsheets.io/blog/dairy-queen-franchise-costs-profits/Ice Cream1,404,2201,143,1800.88.2750,000400,000
Jack in the Boxhttps://sharpsheets.io/blog/jack-in-the-box-franchise-costs-profits/Burger2,195,8001,755,5030.812.51,000,000250,000
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Baskin-Robbinshttps://sharpsheets.io/blog/baskin-robbins-franchise-costs-profits/Ice Cream465,100316,8150.79.8250,000125,000
IHOPhttps://sharpsheets.io/blog/ihop-franchise-costs-profits/Pancakes2,058,3021,553,3110.88.81,500,000500,000
Applebee’shttps://sharpsheets.io/blog/applebees-franchise-costs-profits/Casual American5,137,9662,356,9650.514.51,000,000500,000
Denny'shttps://sharpsheets.io/blog/dennys-franchise-costs-profits/Casual American3,785,4591,639,5490.415.41,000,000500,000
Papa Murphy'shttps://sharpsheets.io/blog/papa-murphys-franchise-costs-profits/Pizza433,174580,4411.35.0275,000125,000
Auntie Anne'shttps://sharpsheets.io/blog/auntie-annes-franchise-costs-profits/Pretzels229,692343,1351.55.6300,000100,000
Firehouse Subshttps://sharpsheets.io/blog/firehouse-subs-franchise-costs-profits/Sandwich613,186888,3561.44.6350,000100,000
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Checkers & Rally'shttps://sharpsheets.io/blog/checkers-franchises-profits-sales-costs/Burger837,8471,039,7731.25.4750,000250,000
Charleys Philly Steakshttps://sharpsheets.io/blog/charleys-philly-steaks-costs-profits/Sandwich509,806786,2331.54.3500,000100,000
Buffalo Wild Wingshttps://sharpsheets.io/blog/buffalo-wild-wings-costs-profits/Chicken3,546,9002,534,1480.79.31,500,000750,000
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A&W Restaurantshttps://sharpsheets.io/blog/aw-restaurants-franchises-costs-profits/Burger786,750851,2121.16.2350,000150,000
Hungry Howie’s Pizzahttps://sharpsheets.io/blog/hungry-howies-pizza-franchise-costs-profits/Pizza419,682806,8991.93.5750,000200,000
Bojangleshttps://sharpsheets.io/blog/bojangles-franchise-costs-profits/Chicken1,658,0001,801,0571.16.11,000,000500,000
McAlister’s Delihttps://sharpsheets.io/blog/mcalister-deli-franchise-costs-profits/Sandwich1,424,9631,865,8611.35.11,000,000500,000
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Qdoba Mexican Eatshttps://sharpsheets.io/blog/qdoba-mexican-eats-franchise-costs-profits/Mexican659,250972,9621.54.5
Freddy’shttps://sharpsheets.io/blog/freddys-franchise-costs-profits/Burger1,453,0401,792,9291.25.41,000,000400,000
Taco John’shttps://sharpsheets.io/blog/taco-johns-franchise-costs-profits/Mexican1,119,0001,124,9801.06.61,000,000400,000
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Einstein Bros. Bagelshttps://sharpsheets.io/blog/einstein-bros-bagels-franchise-costs-profits/Sandwich750,075885,0111.25.71,000,000536,500
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Wetzel's Pretzelshttps://sharpsheets.io/blog/wetzels-pretzels-franchise-costs-profits/Pretzels377,571748,8572.03.4300,00050,000
Pizza Ranchhttps://sharpsheets.io/blog/pizza-ranch-franchise-costs-profits/Pizza3,268,3001,174,0880.418.61,000,000297,000
Del Tacohttps://sharpsheets.io/blog/del-taco-franchise-costs-profits/Mexican1,406,8501,345,3411.07.02,000,000500,000
Schlotzsky’shttps://sharpsheets.io/blog/schlotzskys-franchises-costs-profits/Healthy, Salads1,102,9331,053,3330.322.21,000,000300,000
Captain D’shttps://sharpsheets.io/blog/captain-ds-franchise-profits-costs/Seafood982,7781,067,8160.419.01,000,000350,000
Biggby Coffeehttps://sharpsheets.io/blog/biggby-coffee-franchise-profits-costs/Coffee310,575648,3520.320.0300,000100,000
Which Wichhttps://sharpsheets.io/blog/which-wich-franchises-profits-costs/Sandwich330,375281,8860.322.2500,000150,000
Marble Slab Creameryhttps://sharpsheets.io/blog/marble-slab-franchises-costs-profits/Ice Cream407,360251,0520.416.7250,000100,000
Mountain Mike's Pizzahttps://sharpsheets.io/blog/mountain-mikes-franchise-profits-costs/Pizza410,900865,7130.320.0300,000100,000
Huddle Househttps://sharpsheets.io/blog/huddle-house-franchise-cost-profits/Diner988,743712,4280.513.3600,000300,000
L&L Hawaiian Barbecuehttps://sharpsheets.io/blog/ll-hawaiian-barbecue-franchises-costs-profits/BBQ334,350612,9210.333.3500,000150,000
Chicken Salad Chickhttps://sharpsheets.io/blog/chicken-salad-chick-franchises-costs-profits/Healthy, Salads651,0001,202,0200.320.0750,000250,000
Golden Chickhttps://sharpsheets.io/blog/golden-chick-franchises-costs-profits/Chicken362,975917,6092.52.62,000,000425,000
Perkinshttps://sharpsheets.io/blog/perkins-franchise-costs-profits/Diner1,922,7281,729,2460.97.41,500,000500,000
Waba Grillhttps://sharpsheets.io/blog/waba-grill-franchises-costs-profits/Teryaki454,000466,5361.06.51,000,000250,000
Bruster’s Ice Creamhttps://sharpsheets.io/blog/brusters-franchises-profits-costs/Ice Cream663,925466,6960.79.5375,000150,000

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All content in this article is information of a general nature and does not address the detailed circumstances of any particular individual or entity. Nothing in the article constitutes professional and/or financial and/or legal advice, nor does any information in the article constitute a comprehensive or complete statement of the matters discussed or the law relating thereto. You alone assume the sole responsibility of evaluating the merits and risks associated with the use of any information or other content in this article before making any decisions based on such information or other content.