Growth Club
1851 Growth Club
Franchise Deep Dive: Tropical Smoothie Cafe’s Franchise Costs, Fees, Profit and Data
With the recent demand for healthy food options, the smoothie restaurant saw major franchise development in the past several years.
LAST UPDATED: Jan 20, 2023
FRANCHISE WEBSITE: https://www.tropicalsmoothiefranchise.com/
NUMBER OF LOCATIONS: 1,150+
REPORTED COST TO GET IN: $277,000–$584,000
REPORTED ROI (Item 19): $351,400–$2,733,965 (average net revenue)
After opening in 1997 in Destin, Florida, Tropical Smoothie Cafe saw success really early on. Only a year later, the brand opened its first franchise in Tallahassee. The brand is now known nationally for its fresh smoothie options. With a high demand for healthy restaurants, a lot of entrepreneurs are turning to healthy franchises like Tropical Smoothie to find success in the industry. But what makes Tropical Smoothie a good option for potential franchisees?
How Many Tropical Smoothie Cafe Franchises Are There?
According to Tropical Smoothie’s website, the brand has over 1,150 open restaurants across the country. The smoothie franchise has grown significantly over the last couple of years. Tropical Smoothie ended 2017 with 600 locations open. By the end of 2021, they opened 1,000 locations nationwide.
With a recent surge in demand for healthy food options, restaurants like Tropical Smoothie are continuously seeing growth patterns. In the first half of 2022 alone, the brand signed 139 franchise agreements in large markets across the United States like Philadelphia, Chicago and Salt Lake City.
What Is the Tropical Smoothie Cafe Business Model?
Tropical Smoothie restaurant locations offer end cap, free-standing and in-line real estate options. With each option, the franchisee can choose to have a drive-thru if their location permits it. Every location has to meet the 1,200 to 1,800 square feet requirement. Each Tropical Smoothie location offers a variety of smoothie options, as well as food and services for multiple dayparts: breakfast, lunch, dinner and snacks.
How Much Can Tropical Smoothie Cafe Franchise Owners Make?
The financial performance representations in Tropical Smoothie’s 2022 Franchise Disclosure Document includes the sales information for 768 restaurants that were open for the full calendar year in 2021. The average net revenues for franchise restaurants in 2021 ranged from $351,400 to $2,733,965.
How Much Does It Cost to Open a Tropical Smoothie Cafe?
The estimated total needed to open a Tropical Smoothie Cafe ranges from $277,000 to $584,000. The following are part of the upfront costs included in the initial investment:
- Initial Franchise Fee: $15,000–$30,000
- Professional Fees: $5,000–$15,000
- Restaurant Fixtures, Furniture and Equipment: $95,000–$142,000
- Leasehold Improvements: $140,000–$259,500
- Signage: $3,000–$25,000
- Initial Inventory: $3,500–$19,500
- Initial Training Expenses: $1,000–$15,000
- Initial Deposits: $1,500–$25,000
- Grand Opening Contribution: $5,000–$10,000
- Additional Funds (Working Capital) (3 to 6 Months): $8,000–$42,5000.
The recurring fees to pay throughout the ownership of the franchise include:
- Royalty Fee: 6% of gross sales
- National Marketing Fee: 3–4% of gross sales
- Local Advertising Cooperative Contribution: a minimum of 2% of gross sales
What Is the Franchise Fee for Tropical Smoothie Cafe?
The initial franchise fee for Tropical Smoothie Cafe ranges from $15,000 to $30,000 due upon signing the franchise agreement, according to the brand’s 2022 FDD.
However, there are discounts awarded by the franchise for certain prospects due to special circumstances. During 2021, the initial franchise fee amount ranged from $1 to $30,000. Tropical Smoothie Cafe is a member of the International Franchise Association and a participant in its VetFran program. As a part of this program, the brand reduces the initial franchise fee for qualifying veterans to $15,000 for the first and each franchise developed.
Who Is the Leadership of Tropical Smoothie Cafe?
- Charles Watson—CEO
- Paul Marsden—CFO
- Michael Lapid—Chief Information and Digital Officer
- Cheryl Fletcher—CDO
- Richard Key—COO
- Deborah von Kutzleben—CMO
What Helpful Articles Can I Read to Learn More About Tropical Smoothie Cafe?
