HTeaO Franchise FDD, Profits, Costs & Fees (2024)

HTeaO, an innovative iced tea franchise, was founded in Amarillo, Texas, in 2009 by Justin Howe and Gary Hutchens. Initially conceived as an addition to a family restaurant to boost traffic during the economic downturn, the concept quickly gained popularity.

By 2018, the first corporate store opened in Midland, Texas, and franchising began in 2019. The company is now headquartered in Fort Worth, Texas, where it continues to expand across the U.S., with over 68 locations already in operation and more than 425 franchise licenses awarded.

The franchise offers a unique drive-thru experience centered around 24 handcrafted iced tea flavors, brewed fresh in-store using 100% natural ingredients and a proprietary water filtration system.

Customers can customize their beverages at self-serve stations, creating a memorable and personalized experience. HTeaO also sells related products such as Yeti merchandise, snacks, and bottled water, appealing to a broad customer base.

Initial Investment

How much does it cost to start a HTeaO franchise? It costs on average between $260,000 – $1,977,000 to start a HTeaO franchised restaurant.

This cost includes various expenses such as the initial franchise fee, construction, equipment, and other startup costs.

In comparison, see below a few other tea & bubble tea franchises and their initial investment:

FranchiseInvestment
Funbi$260,000 – $576,000
Sharetea$387,000 – $492,000
Gong Cha$175,000 – $620,000
Coco Fresh Tea & Juice$221,000 – $454,000
Kung Fu Tea$169,000 – $378,000

Average Revenue (AUV)

How much revenue can you make with a HTeaO franchise? A HTeaO franchised restaurant makes on average $900,000 in revenue (AUV) per year.

While individual store performance varies, factors like location quality, local demand, and operational effectiveness play a significant role in achieving higher sales figures.

In comparison, see below a few other tea & bubble tea franchises and their average yearly revenue:

FranchiseInvestment
FunbiUndisclosed
Sharetea$372,000
Gong Cha$429,000
Coco Fresh Tea & Juice$482,000
Kung Fu Tea$347,000

Frequently Asked Questions

How many HTeaO locations are there?

As of the latest data, HTeaO has approximately 68 operational locations across various states, including Texas, Florida, Kansas, New Mexico, and Oklahoma. The brand has awarded over 425 franchise licenses, with 93 additional units currently under development.

What is the total investment required to open a HTeaO franchise?

The total investment required to open a HTeaO franchise ranges from $260,000 to $1,977,000.

What are the ongoing fees for a HTeaO franchise?

HTeaO franchisees pay a 6% royalty fee on gross sales, along with a 1% marketing fee. These fees support the franchisor’s services and brand-wide advertising efforts.

What are the financial requirements to become a HTeaO franchisee?

To become an HTeaO franchisee, candidates must meet specific financial requirements. These include a minimum net worth of $1,000,000 and at least $250,000 in liquid capital.

These requirements ensure that prospective franchisees have the financial stability to cover the initial investment and ongoing operational costs associated with running the franchise.

How much can a HTeaO franchise owner expect to earn?

The average gross sales for a HTeaO franchise are approximately $0.9 million per location. Assuming a 15% operating profit margin, $0.9 million yearly revenue can result in $135,000 EBITDA annually.

Who owns HTeaO?

HTeaO is primarily owned by Justin Howe, who is also the CEO and one of the co-founders of the company. Additionally, private equity firms Crux Capital and Trive Capital hold a minority stake in the company. Their investment supports the franchise’s expansion efforts and operational growth across the U.S.

Disclaimer

Disclaimer: This content has been made for informational and educational purposes only. We do not make any representation or warranties with respect to the accuracy, applicability, fitness, or completeness of the information presented in the article. You should not construe any such information or other material as legal, tax, investment, financial, or other professional advice. Nothing contained in this article constitutes a solicitation, recommendation, endorsement, advertisement, or offer to buy or sell any franchises, securities, or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the franchise and/or securities laws of such jurisdiction.

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