Bahama Buck’s Franchises Sales, Costs & Profits (2023)

A popular franchise known for its acai bowls, smoothies and other frozen coffees and desserts, Bahama Buck’s has more than 100 stores in the US today.

Yet if you’re considering opening a new Bahama Buck’s franchise, you may want to know how much profits you can really make with this business.

Although Bahama Buck’s is a rather affordable franchise ($29,500 franchise fee and $630,000 investment), it’s not the most profitable unfortunately. Indeed we found the payback period hovers around 10 to 12 years on average.

Want to know more? In this article we’re looking at Bahama Buck’s from the angle of its Franchise Disclosure Document to find out whether you should invest in this franchise. Let’s find out!

Bahama Buck’s franchises: key figures

Franchise fee	$29,500
Royalty fee	6.0%
Marketing fee	2.0%
Investment (mid-point)	$631,000
Average sales	$520,000
Sales to investment ratio	0.8x
Payback period*	10 years
Minimum net worth	$950,000
Minimum liquid capital	$100,000

What is Bahama Buck’s?

Bahama Buck’s is an American privately held shaved ice franchise founded by Blake Buchanan in 1990.

Headquartered in Lubbock, Texas, the chain offers shaved ice, smoothies, frozen coffee, desserts, acai bowls, and specialty sodas called “Bahama Sodas,” as well as various Bahama Buck’s-themed clothing items.

Its franchising journey began in 1993, and it currently has more than 100 stores in the US.

Bahama Buck’s franchises pros and cons

Pros

• Management training: The brand offers its franchisees a comprehensive on-the-job and classroom training program to equip them with the basics of the business concept and procedures. It also provides them with grand opening, customer service, handling staff, and ongoing training on how to run a successful business.
• Executive support: The franchisor offers management support to help franchisees establish and run successful restaurants. Franchisees access top leadership guidance and growth strategies that work in their locations. Also, they get professional coaching from other successful franchise owners with solid experience in the industry.
• Exclusive territory protection: The brand grants its franchisees the right to operate their businesses in a protected area. It does not authorize any other franchises or operate a competing restaurant in the agreed-upon territory.
• Site selection and construction: The parent company helps the franchisees identify a convenient business location concerning high traffic and demographic patterns. Also, it provides them with approved standard specifications, restaurant design and construction, lease submittal letters, and lease negotiations.
• Passive investment opportunity: A Bahama Buck’s franchise allows for semi-absentee ownership. Franchisees can run the business alongside other obligations.
• Multiple income streams: The brand embraces online ordering and catering options to add to franchisees’ earning channels. Franchisees get an additional branded mobile truck, multiple tents, or cart units permitted per each franchised location to serve at events and improve their sales.

Cons

• No franchise financing: The franchisor does not finance its franchisees for start-up or ongoing costs, directly or indirectly.
• Not a part-time business: The franchise does not provide a part-time business opportunity. Franchisees must adhere to the parent company’s operating hours. 
• Not a home-based franchise: The Bahama Buck’s franchise cannot be run from home or mobile units. Franchisees are required to have an office facility within the restaurant.
• Strong competition from ice cream brands like Bruster’s, Rita’s, Cold Stone, Baskin Robbins as well as smoothie chains such as Tropical Smoothie Cafe, Clean Juice or even Nekter Juice Bar to name a few

How much do Bahama Buck’s franchises cost?

You have to invest around $630,769 to open a Bahama Buck’s franchised restaurant.

This is an average; indeed, it varies based on many factors, such as the location of your restaurant and its size.

In addition to the initial franchise fee of $29,500, which you must pay to the franchisor, you would also pay for construction improvements, equipment, professional fees, signage, insurance, etc.

Here’s the full breakdown of costs:

Expense	Amount
Initial franchise fees	$29,500
Build-out costs	$120,000-$613,088
Signage	$22,000-$48,000
Equipment	$90,000-$121,000
Additional funds -3 months	$10,000-$34,500
Other	$32,200-$111,750
Total	$303,700-$957,838

What’s the turnover of a Bahama Buck’s franchise?

On average, a Bahama Bucks franchise makes $519,738 in sales per year. This is the average sales per restaurant for the 21 of the 92 franchised restaurants that were open for all of 2019.

How profitable is a Bahama Buck’s franchise?

On average, a Bahama Bucks franchise makes $92,755 in profits per year. This corresponds to a 17.9% EBITDA margin.

Unlike most franchises, Bahama Bucks discloses a lot of details when it comes to costs in its Financial Disclosure Document, which we have summarized below.

Profit and loss	Amount	% of sales
Sales	$519,738	100%
Adjusted COGS (Note 1)	($128,321)	24.69%
Adjusted total expenses (Note 2)	($298,662)	57.46%
Adjusted EBITDA	$92,755	~17.85%

Should you invest in a Bahama Buck’s franchise?

Even though Bahama Buck’s is a profitable business as we just saw (~18% EBITDA margin), it doesn’t necessarily mean you should invest in it. Indeed, to answer that question instead we need to compare profits to the initial investment you would need to make as the franchisee to open a new location.

Assuming net profits of about 10-12% of revenues, in line with the 18% EBITDA margin, we found that Bahama Buck’s has a payback period (the time to recoup your investment) of 10 to 12 years.

Whilst a 10 years payback period isn’t a great investment, it doesn’t mean you should invest in a Bahama Buck’s franchise either. It simply means you would have to wait much longer than other franchises (10 years) before you can finally reap the profits of your business.

Indeed, when making a decision on which franchise you should go for, make sure to consider other factors than financials, such as territory protection, brand name, training and support, etc.

How does it compare vs. other franchises?