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Starbucks Franchise Costs Profit Opportunity: What To Know

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A coffee shop is a great place to meet with colleagues, chat and catch-up with friends, unwind, or study and review some of your lessons while waiting for your next class.

Starbucks, as one of the leading and most popular coffee providers in the world, has become a big part of their customer’s daily lives, and there’s no doubt that having a Starbucks franchise will give a lot of rewarding benefits and outstanding success for an entrepreneur.

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If you’re interested in owning  a Starbucks outlet, and want to know its franchise fee, you can do a cost analysis at franchiseknowhow.com, or continue reading this article for more information about a Starbucks franchise opportunity.

A short history of Starbucks

In 1971, Jerry Baldwin, Gordon Bowker, and Zev Siegl opened the first Starbucks store in Seattle, Washington. They got its name from a character named Starbuck, which is in the novel “Moby Dick” written by Herman Melville.

Howard Schultz, the current CEO and Chairman of Starbucks, who was just an employee of the company back then, purchased Starbucks from the real owners through the help of local investors in 1987. He quickly set a worldwide expansion plan where he rebranded his own Il Giornale coffee outlet and transformed it into a Starbucks outlet. He did this because he became fascinated with the coffee houses that he saw and visited in Italy, and discovered its sense of community. It led him to an idea to bring a similar experience to the United States.

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According to Statista’s survey, in 2018, there are already 29,324 Starbucks stores all over the world. In the United States alone, it has 14,606 locations as of 2017, which has the largest number of Starbucks outlets. There’s no doubt that they will really gain financial success each year because of their global expansion.

Products and Items Offered

Starbucks has different kinds of coffee, whatever your taste preferences are. In addition, here are some of their most popular items and products:

  • Fresh food that includes salads, yogurt, fruit, oatmeals, pastries, sandwiches, and parfaits.
  • Whole bean and ground coffee made by Starbucks and Seattle’s Best Coffee Brands.
  • Ready-to-drink bottled frappuccino, chilled coffees, and bottled or juiced teas.
  • Handcrafted beverages, such as hot and iced espresso, non-coffee blended beverages, fresh-brewed coffee, smoothies, and teas.
  • They also have merchandise such as equipment for brewing tea and coffee, packed goods, books, yearly planners, accessories, mugs, and gifts.
  • Their coffee has 30 different blends and there are also single-origin premium coffees.

Franchising Details

It is important to know that Starbucks doesn’t offer their stores for franchising. They operate it as a licensing model or a food service instead, and if you’re interested in managing a Starbucks outlet, you have to enter into a licensing or food service agreement with the company, wherein they will provide you with a lot of important business aspects, such as equipment, training, layout, advertising, support, and inventory.

That said, you need to choose between a food service and a licensed store. Here are the differences:

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  • Food Service  

    In this type, you can sell Starbucks merchandise and goods, but without the physical store. You can cater to schools, other businesses, military bases, universities, and others.
  • Licensed Store

    This is the actual Starbucks store. You can customize the entire store, and they will provide you with the whole Starbucks menu, their executive food, and merchandise. They will also be available to support you in training and consultations, coffee packages, and all the equipment needed in the store.

For the Starbucks licensing fee, you will obviously need a huge amount of money, which may range between 300,000 and 400,000 USD. But to be sure about the exact amount and other charges of having a licensed store, it’s better to ask Starbucks personally, so that you can discuss and know more about it, especially its cost and the profit that you will get once the business is running if you really want to be their licensee.

Note: As a licensee, you don’t actually own the actual Starbucks store. Basically, you will just rent the Starbucks brand by paying licensing fees.

Franchising is a great investment, especially if the business franchise you’ll get is from a reputable and renowned company. However, when it comes to Starbucks, they prefer licensing or a food service agreement instead in order to have control over the quality of their products and stores. Whatever you choose, there will be a guarantee that you will have a successful experience in having a Starbucks store or their products, as well as reaching your dream business success as well.

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