Three Dog Bakery Franchise Costs, Fees & Profits (2024)

Three Dog Bakery was founded in 1989, inspired by a Great Dane named Gracie, who had food sensitivities. This led her owners to bake healthier treats for her, which eventually turned into the establishment of America’s Original Dog Bakery. The bakery has its headquarters located in Kansas City, Missouri, which is reflective of its American roots and commitment to quality and community.

The bakery distinguishes itself in the pet industry by offering a wide range of high-quality, handmade dog treats. Their product line includes everything from biscuits, celebration cakes, pupcakes, cookies, biscuits, beg-als, cake slices, and brownies, to specialized treats like lickety-splits, and seasonal offerings. These treats are made with real, wholesome ingredients, emphasizing the health and happiness of dogs.

Three Dog Bakery’s differentiation from the competition lies in its focus on high-margin baked goods and seasonal offerings, setting it apart from other pet stores. This focus on quality, combined with a diverse product range and a strong brand story rooted in genuine care for pet wellbeing, positions Three Dog Bakery uniquely in the market.

Number of locations

Here’s how many franchised and company-owned Three Dog Bakery there have been in the United States over the past few years.

Initial investment

Here’s what you can expect to spend to start a Three Dog Bakery franchise.

Note: The table above provides a snapshot of the main costs associated with starting the most common franchise format (as disclosed in the Item 7 of the Franchise Disclosure Document). For a complete overview of all the expenses involved with the various formats offered by the franchisor, please consult the Franchise Disclosure Document.

Franchise fees & Royalties

Here are the main ongoing fees the franchisor will ask you to pay going forward to run the franchise.

Initial Franchise Fee

The Initial Franchise Fee for a single Three Dog Bakery Business is $40,000, payable upon execution of the Franchise Agreement. For additional franchises, the fee is reduced to $30,000 for the second franchise and $25,000 for the third or any additional franchise.

Royalty Fee

The Royalty Fee is 5.5% of the Gross Sales of the Bakery, payable weekly for sales during the immediately prior week.

Marketing Fund Contribution

Franchisees must contribute 1% of total Gross Sales to the Marketing Fund, which may increase up to 3%. This fund is used for advertising and marketing programs, public relations, and market research.

Local Advertising Requirement

Franchisees are required to spend 1% of total Gross Sales on local advertising, which may increase up to 3%, paid monthly as incurred.

Technology Fee

The monthly Technology Fee ranges between $199.00 to $521.00, plus a one-time Setup Fee and Hardware costs ranging between $2,973.00 to $5,747.00.

Training and Support Fees

Supplemental and refresher training may incur a fee of up to $500 per day for up to 2 people, with the potential for additional out-of-pocket expenses.

Transfer Fee

A Transfer Fee of 50% of the then-current Initial Franchise Fee is applicable upon the execution of a new franchise agreement by the transferee.

Renewal Fee

A Renewal Fee of $5,000 is charged for franchisees who qualify and choose to renew their Franchise Agreement.

Profits

Here’s how much revenue and profits you can expect to make with a Three Dog Bakery franchise, as indicated by the franchisor.

How to apply

Opening a Three Dog Bakery franchise involves several steps, designed to ensure you are a good fit for the franchise. Here are the main steps to follow to open a Three Dog Bakery franchise.

1. Conduct Market Research

• Dive into the pet industry and local market conditions using online resources, industry reports, and databases.
• Engage with local dog owners and pet communities to grasp their needs and preferences through surveys or social media.
• Consider hiring professional market research services for comprehensive data.
• Keep your market research updated to stay ahead of trends and competitive dynamics​​.

2. Create a Financial Model and Secure Funding

• Estimate startup costs, including the franchise fee, equipment, and initial marketing, to understand the investment needed.
• Project monthly expenses and forecast revenue based on your market research.
• Explore funding options like bank loans or small business grants and prepare a convincing business plan.
• Seek advice from financial professionals to ensure a realistic financial model​​.

3. Identify a Suitable Location

• Focus on dog-friendly neighborhoods or commercial areas with good accessibility and parking.
• Ensure the location is visible and has minimal direct competition.
• Analyze local demographics to target areas with a higher number of dog owners or higher disposable incomes​​.

4. Obtain Necessary Permits and Licenses

• Research and comply with local regulations specific to pet-related businesses.
• Acquire all essential permits, like business licenses and health permits, ensuring your bakery meets all legal requirements​​.

5. Source Suppliers for Premium Dog Treats and Retail Products

• Find reputable suppliers for high-quality dog treats and products.
• Evaluate suppliers based on their product quality, reliability, and alignment with your business values.
• Establish a dependable supply chain to maintain a consistent stock of premium products​​.

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.

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.