Bruster’s Ice Cream Franchises: 9 Years Payback (+ Profits)

Bruster’s Ice Cream is one the most popular ice cream franchise along with the giants Dairy Queen, Baskin Robbins or other big players like Rita’s or Cold Stone Creamery. With such strong competition, it’s important to understand the financials when choosing to buy a franchise.

In other words, is Bruster’s Ice Cream a profitable business? Is this worth investing the required investment of $663,925?

In this article we’ll answer a few questions like: how much sales does a Bruster’s Ice Cream makes? How much profits can you earn as a franchisee? And more importantly we’ll see whether the profits are worth the upfront investment. Let’s find out!

Bruster’s franchises: key figures

Franchise fee	$35,000
Royalty fee	5.0%
Marketing fee	3.0%
Investment (mid-point)	$664,000
Average sales	$467,000
Sales to investment ratio	0.7x
Payback period*	9 years
Minimum net worth	$375,000
Minimum liquid capital	$150,000

What is Bruster’s Real Ice Cream?

Bruster’s Real Ice is an American ice cream parlor chain with more than 200 locations in 22 US states.

It primarily serves ice cream and frozen yogurt. In addition, offers handmade ice cream cakes, homemade waffle cones, milkshakes, sundaes, banana splits, and non-dairy ice cream flavors made with oat milk.

The chain was founded by Bruce Reed in 1989 in Bridgewater, Pennsylvania, where it is headquartered.

Its franchising journey started in 1993 and is franchised by the parent company, Bruster’s Limited Partnership.

Bruster’s franchises: pros and cons

Pros

• Multiple options: The brand utilizes walk-up stores with multiple service windows as well as catering options. It also offers franchisees end-cap or dine-in franchise formats. Franchisees create great ways for customers to enjoy family gathering moments and maximize their revenues.
• Comprehensive training: The brand offers its franchisees a detailed and quality training program to prepare them to successfully carry out their business concept. It teaches them the fundamentals of their products and procedures, as well as customer service and inventory management, to reduce their operating costs.
• Site selection support: The brand provides its franchisee with real estate support to identify a convenient business location regarding traffic patterns and future expansion. In addition, it provides franchisees with designs, standard specifications, construction, and lease negotiations to lower development costs.
• Comprehensive national marketing program: Bruster’s Real Ice Cream has effective marketing tools, programs, and field representatives. Franchisees can leverage the brand’s popularity and create awareness for their local stores to attract a larger customer base.
• Sophisticated data-driven analytics: The brand provides its franchisees with effective data analysis to make sure their stores are on the right performance track. Franchisees can monitor and analyze their stores’ performance and establish where changes are needed.
• Exclusive territory protection: The franchisor grants its franchisees the right to operate their restaurants in an approved location. Therefore, the franchisor does not license any other franchises or operate other competitive channels in the agreed-upon location.

Cons

• Not a part-time business: The franchise is not a part-time business venture. Franchisees are required to follow the parent company’s working program.
• No financing: The franchisor does not directly or indirectly finance its franchisees for startup costs, equipment, inventory, accounts receivable, and payroll.
• Not a mobile business opportunity: Bruster’s franchise cannot be run from home or a mobile unit. Franchises need official facilities to operate in their restaurants.

How much does a Bruster’s franchise cost?

You would have to invest on average $915,000 to open a new Bruster’s Real Ice Cream franchise restaurant.

Note that this is the investment for a freestanding unit. Indeed, there are 2 restaurant formats you can choose from:

• Freestanding unit: $915,000
• Endcap unit: $412,850

Of course, this number is an average: it varies based on many factors, such as the location of your restaurant, its size, etc.

Here’s the full breakdown of what your investment will cover, for both freestanding and endcap units:

Expense category	Freestanding	Endcap
Initial franchise fees	$35,000	$35,000
Equipment, design, construction	$245,000 – $396,000	$140,000 – $407,000
Signage	$20,000 – $25,000	$8,200 – $16,500
Working capital 3-6 months	$10,000 – $25,000	$10,000 – $25,000
Other	$200,000 – $839,000	$38,000 – $110,500
Total	$510,000 – $1,320,000	$231,200 – $594,500

What’s the average turnover of a Bruster’s?

On average, a Bruster’s Real Ice Cream franchise makes $466,696 in sales per year. This is the average sales per restaurant for the 145 of the 175 franchised restaurants as disclosed in the Franchise Disclosure Document.

How profitable is a Bruster’s franchise?

On average, a Bruster’s Real Ice Cream franchise makes $134,865 profits per year. This corresponds to a 29% adjusted EBITDA margin. 

Bruster’s Real Ice Cream is a profitable franchise. Indeed, we found that the 29% profit margin is higher than the average for similar restaurant franchises (25-27%). 

We calculated this number using the information available in the Franchise Disclosure Document 2020. Unfortunately, Bruster’s Real Ice Cream has not provided detailed information on the labor costs. Therefore, we used 29% of sales, as per industry benchmark.

Profit and loss	Amount ($)	% sales
Sales	$466,696	100%
COGS	($114,154)	24.5%
Labor	($135,342)	29.0%*
Rent	($45,000)	9.6%
Royalty + marketing fees	($37,336)	8.0%
Adjusted EBITDA	$134,865	~29.0%

Is a Bruster’s franchise a good investment?

Now that we know how profitable Bruster’s Ice Cream franchises really are, we can assess whether the profits are worth the initial investment cost of $663,925 (on average).

That’s what we refer to with the payback period: how long does it take for the future profits to repay the initial investment.

We Bruster’s we found it takes on average 9.5 years for the future profits to pay back the initial investment cost. Whilst not necessarily bad, it’s not the best investment either. As rule of thumb, the best payback periods we found for restaurant franchises were in the 3-6 years range.

That being said, your decision to invest in a franchise should not stop at the financials. It should also take into account other factors like the support from the franchisor, competition, training, financing, etc.

How does it compare vs. other franchises?