Robeks Franchises: $605K AUV & a 4 Years Payback

If you’re ever considered to open a smoothie franchise store, you must have come across Robeks. Unlike the more famous Jamba and Smoothie King, Robeks is a very profitable investment if you look at it purely from a financial standpoint.

Indeed, you would need to invest (only) $340,850 to open a new Robeks location and this store would generate an annual turnover of $605,600 (on average), not bad.

In addition we found Robeks franchises have an excellent payback period of 3.8 years. So if you’re still wondering which smoothie franchise you should go for, you should seriously consider Robeks.

How much does it really cost to open a new Robeks smoothie shop? How much profits can you realistically make with this franchise? Should you invest in a Robeks franchise? Let’s find out!

Robeks franchises: key figures

Franchise fee	$30,000
Royalty fee	7.0%
Marketing fee	5.0%
Investment (mid-point)	$341,000
Average sales	$606,000
Sales to investment ratio	1.8x
Payback period*	4 years
Minimum net worth	$300,000
Minimum liquid capital	$100,000

What is Robeks?

Robeks is an American smoothie franchise based in Los Angeles, California.

The chain was founded by Davidson Robertson in 1996 in Southern California.

It offers smoothies, juices, frozen fruits, toasts, boosts, enrichments, and bowls. Robeks started franchising in 2001 and currently has 85 locations in the US.

Robeks franchises pros and cons

Pros

• Comprehensive training program: The brand has detailed classroom and on-the-job training for its franchisees. It trains them on its systems and procedures, products, customer service, and management operations. Also, it trains them for a successful grand opening and continues to train them for success after launching the restaurants.
• Site selection and construction: The brand has an experienced real estate team and brokers. It helps its franchisees with site selection, store design, floor plans, construction, and lease negotiations.
• Marketing and public relations: Robeks has a robust marketing strategy to help its franchisees with their publicity and local store marketing. It provides its franchisees with effective local store marketing tools and resources to prepare them for grand opening and event planning, digital and social media marketing, sponsorships and fundraisers, trade area assessment, and ongoing promotional campaigns.
• Simple operation: The Robeks concept is easy and simple to implement with no cooking, fryers, or grills. Also, it requires less staff and training, which reduces labor costs. Franchisees can get started quickly, work on quality service, and improve their profitability.

Cons

• No direct franchise financing: The brand does not directly or indirectly finance the franchisees for start-up costs, equipment, inventory, or trade fixtures. Also, it does not guarantee any lease, note, or grant on behalf of its franchisees.
• Not a part-time business: The franchise does not present a part-time business opportunity. Franchisees are supposed to follow the operating hours set by the franchisor.
• No absentee ownership: The franchise is not a passive investment opportunity. Franchisees are required to be actively involved in the decision-making and daily running of the restaurants.
• Competition: Robeks franchisees face stiff competition from well-established juice and smoothie brands such as Tropical Smoothie Café, Clean Juice or Jamba to name a few

How much does it cost to own a Robeks franchise?

On average, you may need to invest around $340,850 to open a new Robeks restaurant.

The investment amount is an estimated average; thus, it may change depending on factors like restaurant size, location, etc. According to the latest Franchise Disclosure Document, the required investment can be as low as $286,650 and as high as $395,050.

Robeks franchises startup costs

Why would you need this much amount at the beginning, you may ask? Well, this amount covers all the startup costs you may need to pay to start a Robeks restaurant.

In addition to the initial franchise fee of $30,000, the investment pays for:

• Formation Costs: business licenses, leasehold improvements, fixtures, signs, computer system, POS, equipment, architect fees, security deposit, training expenses, signs, construction, etc.
• Initial Marketing: grand opening advertising fee 
• Operating Costs: rent, insurance, utility deposit, initial inventory, working capital for first 3 months, etc.

Type of cost	Low	High
Initial Franchise Fee	$30,000	$30,000
Formation Costs	$237,500	$332,500
Initial Marketing	$5,000	$5,000
Operating Costs	$14,150	$27,550
Total	$286,650	$395,050

What’s the AUV of a Robeks franchise?

On average, a Robeks franchise has a $605,639 Average Unit Volume.

This is the annual turnover of 68 franchised restaurants operating in 2021. Although there were a total of 85 restaurants operating in 2021, Robeks only includes in its FDD those that were open for the full 52 weeks in the 2021 fiscal year.

When it comes to revenue growth, Robeks franchises are doing pretty well: sales are bouncing back from their pandemic lows (+34.6% revenue growth in 2021 vs. 2020).

How profitable is a Robeks franchise?

We estimate that an average Robeks franchise makes $151,917 in profits per year. This represents a 25% profit margin (adjusted EBITDA margin).

The 25% adjusted EBITDA margin is in line compared to similar restaurant franchises as per our intelligence (~25-27% industry average). 

Note that Robeks doesn’t provide any financial information regarding costs for their franchises. Indeed, we had to use the industry average for COGS (25% sales) and labor costs (29%) to calculate this number.

Profit and loss	Amount	% of sales
Sales	$605,639	100%
COGS	$(151,410)	25.0%*
Labor	$(175,635)	29.0%*
Rent	$(54,000)	8.9%
Royalty + marketing fees	$(72,677)	12.0%
Adjusted EBITDA	$151,917	~25%

Should you invest in a Robeks franchise?

In order to assess whether you should invest in a franchise, there are a number of parameters to take into consideration.

Besides the pros and cons discussed earlier (like the support from the franchisor, territory protection, and so on), you also need to take into account the profitability of an investment.

In other words, you must consider whether the profits are worth the initial investment. That’s what we look at when we calculate the payback period: the time it takes for an investment (like buying a franchise) to repay itself with the profits.

As explained in the introduction, Robeks has an excellent payback period of 3.8 years: you would wait only 4 years to repay the initial upfront investment (like creditors and investors) before you can reap the profits of your franchise.

How does it compare vs. other franchises?