Franchise Deep Dive: Randy's Donuts Franchise Costs, Fees, Profit and Data

This franchise — a Los Angeles staple for more than 70 years — is widely regarded as one of the best donut shops in the United States.

By Victoria CampisiStaff Writer

8:08AM • 04/19/24

LAST UPDATED: 2/2024

FRANCHISE WEBSITE: https://randysdonuts.com/franchise/

NUMBER OF LOCATIONS: 35

REPORTED COST TO GET IN: $246,750 - $1,080,500

REPORTED ROI (Item 19): N/A

Randy's Donuts is a donut shop franchise headquartered in Inglewood, California. The brand is known for its giant rooftop donut and high-quality baked goods.

How Many Randy's Donuts Locations Are There?

Randy's Donuts was founded in 1952 in Inglewood, California. Its original location at 805 W Manchester Blvd became iconic for its giant rooftop donut, which quickly became a symbol of the brand and has since appeared in numerous TV shows and movies

Over the years, Randy's Donuts has gained a reputation for offering some of the best donuts in the country. Its donuts are known for being fluffy, airy, large and staying fresh longer. The shop has consistently been named one of the top donut shops in the country and has received high ratings and reviews on platforms like Yelp for decades.

While Randy's Donuts started as a single iconic donut shop, it has since expanded its presence throughout Southern California, the United States, and even internationally, with 35 locations worldwide.

What Is The Randy's Donuts Business Model?

Randy's Donuts operates primarily as a traditional brick-and-mortar retail business specializing in the sale of donuts and other baked goods. Here's a breakdown of their business model:

Product Offering: Randy's Donuts offers a variety of donuts, ranging from classic flavors like glazed and chocolate to specialty options like maple bacon and red velvet. They also offer coffee and other beverages to complement their donut selection.
Quality and Authenticity: The business model emphasizes the quality and authenticity of the brand’s products. Randy's Donuts prides itself on using expert bakers, secret recipes, proprietary ingredients, and handmade processes to ensure its donuts are fluffy, airy and delicious.
Iconic Branding: Randy's Donuts leverages its iconic branding, particularly the giant rooftop donut atop its original location in Inglewood, California. This branding has become synonymous with the company and helps attract customers both locally and from afar.
Customer Experience: The business model focuses on providing customers with a memorable experience beyond just purchasing donuts. The giant rooftop donut serves as a photo-worthy attraction, and the shop's appearances in movies, television and advertisements contribute to its overall appeal.
Expansion Strategy: While rooted in its original location, Randy's Donuts has expanded its presence both domestically and internationally. The expansion strategy involves opening new locations in high-traffic areas to cater to a broader customer base while maintaining the quality and authenticity that the brand is known for.

How Much Can Randy's Donuts Owners Make?

Earnings for Randy’s Donuts are not publicly available.

How Much Does It Cost to Open a Randy's Donuts Franchise?

The total investment required to open a Randy’s Donuts franchise will depend on site-specific conditions and landlord contributions. The estimated total cost will range from $423,750 to $558,500 for an inline store, $934,750 to $1,080,500 for a drive-thru store and $246,750 to $359,500 for a non-baking kiosk store.

The development fee is equal to the first store’s franchise fee plus 50% of all other store franchise fees ($12,500 per unit), the royalty fee is 5% of gross sales and the brand fund contribution ranges between 2% to 4%.

Franchisees must also be capitalized, with a minimum net worth of $1 million of which $300,000 must be liquid assets.

What Is the Franchise Fee for Randy's Donuts?

The franchise fee for Randy’s Donuts is $35,000 for the first store and $25,000 for each subsequent store.

Who Are the Leaders of Randy's Donuts?

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