Franchise Deep Dive: Nothing Bundt Cakes Franchise Costs, Fees, Profit and DataFranchisor Stories

Franchise Deep Dive: Nothing Bundt Cakes Franchise Costs, Fees, Profit and Data

With an estimated payback period of around three years, the baked goods and retail franchise opportunity is one of the most popular in the industry.

LAST UPDATED: January 15, 2022

FRANCHISE WEBSITE: https://www.nothingbundtcakes.com/franchise-opportunities/

NUMBER OF LOCATIONS: 399

REPORTED COST TO GET IN: $483,600 to $699,700

REPORTED ROI (Item 19):  $1,458,251 (Net Revenue for 274 Franchised Bakeries)

Nothing Bundt Cakes is a gourmet bakery franchisor offering specialty bundt cakes and retail gift items in markets across the U.S. and Canada. It is one of the most popular franchise opportunities in the crowded bakery segment, which includes competitors such as Paris Baguette* and Cinnabon

How Many Nothing Bundt Cakes Are There?

Today, there are approximately 430 Nothing Bundt Cakes bakeries all across North America, most of which are franchised.

Nothing Bundt Cakes was founded in 1997 by Dena Tripp and Debbie Shwetz, two friends in Las Vegas, Nevada who had been baking together for years. After their family and friends persuaded them to start their own bakery, Tripp and Shwetz realized that there was a gap in the market for cakes made from pure, high-quality ingredients. Tripp and Shwetz decided to focus on bundt cakes, which no other brand was doing at the time.

After developing the Nothing Bundt Cakes brands over the next decade, Tripp and Shwetz decided to start franchising in 2006, making sure each location maintained a “mom and pop shop” feeling to emphasize that their bundt cakes are made from scratch with only the best ingredients. The approach worked. By the end of the next decade, the brand had around 200 bakeries open and operating. 

In 2016, Nothing Bundt Cakes was acquired by Los Angeles-based private equity firm Levine Leichtman Capital Partners (LLCP). In 2021, LLCP sold Nothing Bundt Cakes to Roark Capital. 

Over the last three years, 136 new Nothing Bundt Cakes locations have opened for an impressive average of around 45 new locations a year. The brand was recently ranked No. 53 on Entrepreneur’s 2023 Franchise 500 list, falling significantly from its highest position at No. 19 in 2021.

What Is the Nothing Bundt Cakes Business Model?

The company’s products are handcrafted and baked on-site daily with high-quality ingredients and proprietary formulations distributed by its in-house facilities. The shop operates as a carryout-only bakery, selling four different sizes of bundt cakes ready for purchase. There’s also a retail space in the bakery with balloons, small gifts, candles and more available.

How Much Can Nothing Bundt Cakes Owners Make?

According to the brand’s Item 19, the net revenues from January 1, 2021 through December 31, 2021 (the “Measurement Period”) for 361 franchised Bakeries, all of which have been operating for at least 12 months as of December 31, 2021, are as follows:

First Quartile

  • Number of Nothing Bundt Cakes Bakeries: 91
  • Average Net Sales: $894,367
  • Percentage That Met or Exceeded Average: 67%
  • Median Net Sales: $916,755
  • Lowest Net Sales: $532,026
  • Highest Net Sales: $1,056,894
  • Average Check: $24.88
  • Average Ticket Count: 36,440

Second Quartile

  • Number of Nothing Bundt Cakes Bakeries: 90
  • Average Net Sales: $1,236,273
  • Percentage That Met or Exceeded Average: 47%
  • Median Net Sales: $1,235,672
  • Lowest Net Sales: $1,056,894
  • Highest Net Sales: $1,307,698
  • Average Check: $25.01
  • Average Ticket Count: 49,995

Third Quartile

  • Number of Nothing Bundt Cakes Bakeries: 90
  • Average Net Sales: $1,520,320
  • Percentage That Met or Exceeded Average: 41%
  • Median Net Sales: $1,503,426
  • Lowest Net Sales: $1,307,698
  • Highest Net Sales: $1,680,973
  • Average Check: $25.82
  • Average Ticket Count: 59,466

Fourth Quartile

  • Number of Nothing Bundt Cakes Bakeries: 90
  • Average Net Sales: $2,178,800
  • Percentage That Met or Exceeded Average: 37%
  • Median Net Sales: $2,106,985
  • Lowest Net Sales: $1,680,973
  • Highest Net Sales: $3,332,113
  • Average Check: $26.68
  • Average Ticket Count: 82,003

The net revenues for the measurement period for 317 franchised bakeries, all of which have been open for at least 24 months as of December 31, 2021, are as follows:

First Quartile

  • Number of Nothing Bundt Cakes Bakeries: 80
  • Average Net Sales: $912,454
  • Percentage That Met or Exceeded Average: 56%
  • Median Net Sales: $933,730
  • Lowest Net Sales: $532,026
  • Highest Net Sales: $1,112,278
  • Average Check: $25.01
  • Average Ticket Count: 36,900

Second Quartile

  • Number of Nothing Bundt Cakes Bakeries: 79
  • Average Net Sales: $1,234,960
  • Percentage That Met or Exceeded Average: 52%
  • Median Net Sales: $1,235,284
  • Lowest Net Sales: $1,112,278
  • Highest Net Sales: $1,363,791
  • Average Check: $25.13
  • Average Ticket Count: 49,655

Third Quartile

  • Number of Nothing Bundt Cakes Bakeries: 79
  • Average Net Sales: $1,519,370
  • Percentage That Met or Exceeded Average: 44%
  • Median Net Sales: $1,495,647
  • Lowest Net Sales: $1,363,791
  • Highest Net Sales: $1,749,388
  • Average Check: $25.81
  • Average Ticket Count: 59,498

Fourth Quartile

  • Number of Nothing Bundt Cakes Bakeries: 79
  • Average Net Sales: $2,181,047
  • Percentage That Met or Exceeded Average: 41%
  • Median Net Sales: $2,106,985
  • Lowest Net Sales: $1,749,388
  • Highest Net Sales: $3,332,113
  • Average Check: $26.70
  • Average Ticket Count: 82,016

The average net revenues, average cost of goods sold, average gross margin, average payroll costs, average occupancy expenses, average advertising expenses, average other expenses, average interest expenses, average depreciation and amortization expenses, average net income and average Earnings Before Interest, Taxes, Depreciation (EBITDA) achieved by 274 franchised Bakeries for the Measurement Period, all of which have been operating for at least 24 months as of December 31, 2021, is as follows:

  • Net Revenues: $1,458,251 (100.0%)
  • Cost of Goods Sold: $333,737 (22.9%)
  • Gross Margin: $1,124,515 (77.1%)

Expenses:

  • Payroll: $465,140 (31.9%)
  • Occupancy: $81,278 (5.6%)
  • Marketing and Advertising: $56,989 (3.9%)
  • Other Expenses: $192,173 (13.2%)
  • Interest Expense: $5,924 (0.4%)
  • Depreciation and Amortization: $13,119 (0.9%)
  • Taxes: $7,488 (0.5%)
  • Total Expense: $822,111 (56.4%)

Net Income: $302,404 (20.7%)

Add Back to Net Income to Calculate EBITDA

  • Interest Expense: $5,924 (0.4%)
  • Depreciation and Amortization: $13,119 (0.9%)
  • Taxes: $7,488 (0.5%)

EBITDA: $328,934 (22.6%)

Reported Franchisee Expenses: $56,705 (3.9%)

EBITDA Excluding Franchisee Expenses: $385,640 (26.4%)

The first five years of sales performance for the franchised Bakeries opened during the period from January 1, 2015 to December 31, 2020, includes:

Year 1

  • Number of Nothing Bundt Cakes Bakeries: 251
  • Average Annual Net Sales: $821,925
  • Year-Over-Year Growth Percentage: N/A
  • Percentage That Met or Exceeded Average: 45%
  • Median Net Sales: $784,000
  • Highest Net Sales: $1,986,744
  • Lowest Net Sales: $306,424

Year 2

  • Number of Nothing Bundt Cakes Bakeries: 210
  • Average Annual Net Sales: $952,297
  • Year-Over-Year Growth Percentage: 16%
  • Percentage That Met or Exceeded Average: 46%
  • Median Net Sales: $920,035
  • Highest Net Sales: $1,833,056
  • Lowest Net Sales: $429,276

Year 3

  • Number of Nothing Bundt Cakes Bakeries: 158
  • Average Annual Net Sales: $1,107,743
  • Year-Over-Year Growth Percentage: 16%
  • Percentage That Met or Exceeded Average: 44%
  • Median Net Sales: $1,061,443
  • Highest Net Sales: $2,067,987
  • Lowest Net Sales: $495,994

Year 4

  • Number of Nothing Bundt Cakes Bakeries: 117
  • Average Annual Net Sales: $1,214,631
  • Year-Over-Year Growth Percentage: 10%
  • Percentage That Met or Exceeded Average: 42%
  • Median Net Sales: $1,168,680
  • Highest Net Sales: $2,644,664
  • Lowest Net Sales: $579,296

Year 5

  • Number of Nothing Bundt Cakes Bakeries: 72
  • Average Annual Net Sales: $1,380,635
  • Year-Over-Year Growth Percentage: 14%
  • Percentage That Met or Exceeded Average: 40%
  • Median Net Sales: $1,303,296
  • Highest Net Sales: $3,045,473
  • Lowest Net Sales: $639,327

How Much Does It Cost to Open a Nothing Bundt Cakes?

The total initial investment necessary to open a Nothing Bundt Cakes bakery ranges from a cost of $483,600 to $699,700.

  • Initial Franchise Fee: $35,000
  • Extension Fee: $0 to $10,000
  • Rent and Security Deposit: $6,500 to $8,500
  • Bakery Improvements: $175,000 to $285,000
  • Architect—Design: $9,800 to $12,500
  • Fixtures and Equipment—Front of Bakery: $33,500 to $40,000
  • Fixtures and Equipment—Back of Bakery: $124,000 to $145,000
  • Exterior Signage: $8,000 to $12,000
  • Initial Inventory: $20,100 to $24,000
  • Point of Sale System: $6,000 to $11,300
  • Insurance: $2,800 to $5,500
  • Business License and Permits: $1,500 to $4,500
  • Professional Fees: $3,900 to $11,200
  • Opening Advertising Program: $5,000 to $10,000
  • Training Expenses: $4,000 to $7,000
  • Delivery Vehicle—Monthly Lease or Loan Payment: $18,500 to $33,200
  • Additional Funds—3 Months: $30,000 to $45,000

Franchise candidates and their partners/investors must have a combined liquid capital of at least $250,000 and a combined net worth of at least $750,000 to qualify financially.

What Is the Franchise Fee for Nothing Bundt Cakes?

  • The initial franchise is $25,000, with a grand opening allocation of $5,000.
  • Royalty: 6% of Bakery’s weekly Net Revenues
  • Marketing Production Fund (the “Production Fund”): Combined contributions made by you for the Production Fund and the Paid Media Fund will be 5% of your weekly Net Revenues
  • Paid Media Fund (the “Media Fund”): Combined contributions made by you for the Media Fund and the Production Fund will be 5% of your weekly Net Revenues

Who Is the Leadership of Nothing Bundt Cakes?

What Helpful Articles Can I Read to Learn More About Nothing Bundt Cakes?

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*This brand is a paid partner of 1851 Franchise. For more information on paid partnerships please click here.

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