You’re not a true cookie aficionado monster if you haven’t tried Crumbl cookie. Crumbl is a gourmet cookie franchise company with more than 264 bakeries across 36 states. The company was co-founded by two cousins, Jason McGowan and Sawyer Hemsley in Logan, Utah in 2017. Crumbl Cookie began as a delivery service and continues to offer the service in all locations even with a brick-and-mortar presence.
How Much Does it Really Cost to Open a Crumbl Franchise? In order to open a Crumbl franchise, a total investment ranging from $227, 666 to $567, 833 is needed. The franchise fee is $25, 000. If you want to reserve a territory for a multi-unit development, the up-front fee is $5, 000 plus $20, 000 multiplied by the number of units to be developed. Take our franchise quiz to find out if Crumbl is the best choice for you.
If you’re interested in buying a franchise with this gourmet cookie business, read on. In this report, I discuss the financial requirements associated with franchising Crumbl along with the benefits and challenges you’ll encounter as a franchise owner.
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You should be familiar with the financial requirements and costs of purchasing a Crumbl franchise before you decide to invest. I’ve outlined the essential financial requirements and fees the chain requires to you understand the total cost to invest. Before get into the financial requirements, let me quickly define the financial terms you’ll encounter in this section.
A minimum of $150, 000 of liquid capital will be needed to open a franchise of this cookie chain. The total investment in this franchise could range between $227, 666 and $567, 833. Crumbl charges $25, 000 for the standard initial fee, but franchisees interested in opening multiple Crumbl units will pay $5, 000 plus $20, 000 for each new franchise unit.
The advertising payment for Crumbl are 2% of gross sales on a weekly basis. Furthermore, a discretionary fee is charged for marketing materials and payable upon request.
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When you buy a franchise, you must understand the level of financial and time investment that will be required to be successful. You will need a lot of equipment, such as food, ovens, appropriate food disposal machines, venting systems, furniture, etc. Fortunately, one of the benefits of working with a franchise opportunity is that the company will outline the exact equipment you need to purchase and from each specific vendor. If you were to start an independent bakery instead, you would need to figure this stuff out yourself and weigh the pros / cons of each equipment purchase.
Other franchise costs to consider include royalties and marketing fees. While the seemingly endless list of franchise fees may seem overwhelming, keep in mind that these are fees that are common to franchises. It’s a cost of doing business as the operator of a franchise opportunity.
A recent report by Nation’s Restaurant News (NRN) listed the top 25 restaurant chains with the fastest growth measured by system-wide sales in the US, and Crumbl topped the list. In 2020, Crumbl generated $53.4 million in system-wide sales , a 93% increase over the previous year.
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In 2019, the company averaged $1.3 million in total sales on average per store with a net profit of $284, 00 per store. As a prospective franchisee, it’s good to see that this bakery concept has a strong per store profitability.
Crumbl recorded a loss in net income in 2018, which was the year they first began franchising. However, in the following year, the gourmet cookie chain made a comeback almost certainly due to increasing franchise growth and success. It is worth noting that since Crumbl is on the smaller and younger end of the Food and Beverage franchise category and systemwide revenues aren’t as high yet as other franchise concepts that have been around for decades and have thousands of units in some cases.
Crumbl was founded in 2017 by Jason McGowan and Sawyer Hemsley as a side gig. Interestingly, the two founders had no background in baking. In fact, their cookie recipe was developed in an impressive way using the A/B testing. Having come from the tech sector, McGowan thought A/B testing their way to the perfect cookie was the best way to go.
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Shortly thereafter, they began adding new flavors, leading to their concept of a rotating menu. Every week, Crumbl rotates their cookie line-up with Sawyer Hemsley approving the weekly flavors. The selection is based on customer requests, ingredient availability, visual presentation, and variation in flavors.
Crumbl originated with an amazingly delicious chocolate chip cookie and has expanded to over 170 flavors, including themed cookie lineups like breakfast cookies, such as waffle and berry crunch. Since its inception, the gourmet cookie chain has grown impressively with over 200 locations and racked up over a million followers on TikTok. Fresh baked cookies, after all, are the ideal share-worthy social media content.
In Crumbl’s Franchise Disclosure Document (FDD) , a subset of continuously operating franchises from 2019 is taken into account. The chain’s FDD shows that there were 14 franchises at the beginning of 2019 that were still operating at the end of the year. This is about 26% of the total franchised outlets that were operating at the end of the year.
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The financial data of the 14 franchise locations shows that the average revenue of Crumbl’s franchise owners was $1, 316, 002 in the 2019 calendar year. Additionally, the average gross profit of the 14 locations was $595, 825, and the average net profit was $284, 047.
There are several factors to consider before embarking on a franchise venture. In addition to the financial requirements and profitability of the business, you should also look at other factors like training and longterm company stability. With that in mind, I’ve outlined the main competitive advantages of owning a Crumbl store.
Since the company’s inception four years ago, the company has experienced massive growth. It is truly incredible that all these stores have been opened in only four years.
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As a matter of fact, more than 180 units have been launched since the pandemic started, and 8 to 10 new units are being unveiled each week at the time I write this. If those are not impressive enough, not a single one of the company’s locations have closed since the franchise concept became available. While this franchise is still new, this is promising.
Every Sunday, which is the store’s only day off, Crumbl announces the following week’s new set of cookie flavors. This rotating menu concept created by Crumbl has helped the chain make a buzz around its limited-edition cookies.
Having only four flavors a week is a clever marketing tactic and gets consumers excited about what the menu will be each week. Each cookie feels exclusive, so consumers feel the need to rush to the store to be able to try it before it disappears. Cookie lovers never go bored trying their unique flavors every week.
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If you have been active on the social media since 2020, you may have already heard about Crumbl. Over the course of one month, the chain has gained 800k followers on TikTok, the newest leading social media platform with 80+ million monthly with most users fitting into the 16 – 24 year old demographic.
Thanks to a carefully curated TikTok page, Crumbl reaches millions of viewers, many of whom have become loyal customers. Crumbl’s master of social media is without question one of its key competitive advantages. Social media websites like Instagram and TikTok are extremely visually driven and much of the content shared on these platforms is tied to food photos and videos.
Cookies in particular are a food item that has the potential to go viral. Combine this with a rotating menu of flavors and the company has no shortage of content to create and share. Most food businesses have little engagement on social media platforms. But Crumbl is different.
How Much Does It Cost To Start A Crumbl Cookie Franchise?
Crumbl provides income statements of the company’s operating and existing franchisees to help the prospective ones decide if the chain is worth investing in. But with the volume of sales the chain is getting, it’s easy to understand why they’re so transparent.
The franchise fee for a Crumbl Cookie location is $25, 000 which is on the low-end for a Food and Beverage franchise. Additionally, Crumbl charges a lower franchise fee than one of its competitors, Scooped Cookie Dough Bar that requires an initial franchise fee of $29, 900. I’d argue that Crumbl has a more recognized brand as well.
There are downsides to owning a Crumbl location that you should know about before filling out a franchise application. In order to assist you in your decision-making if this franchise is worth it or not, I’ve compiled a list of some of the challenges to expect.
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Changing the menu each week may pose operational challenges. One of the disadvantages is that you must constantly retrain your staff for each new cookie, which is time-consuming and expensive. You also need to spend more time marketing and share the menu on social media. If you don’t enjoy social media marketing, a more traditional food franchise that relies more
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