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Thinking of getting a piece of the Starbucks franchise action?

The most successful coffee retailer in U.S. history, which spends $95 million a year on advertising, the Starbucks brand is world-famous and seemingly ubiquitous. With this sort of name recognition, who wouldn’t want to own a piece of that...
 Starbucks brand is world-famous and seemingly ubiquitou..
 
 

The most successful coffee retailer in U.S. history, which spends $95 million a year on advertising, the Starbucks brand is world-famous and seemingly ubiquitous. With this sort of name recognition, who wouldn’t want to own a piece of that action? Well you can’t. According to the company’s Web site, “Starbucks does not franchise [its] operations and has no plans to franchise in the foreseeable future.”

Unlike lots of other businesses that rely on franchise owners to spread their name far and wide, such as fast food restaurants, nearly all the Starbucks establishments are actually company-owned stores. While the corporation does not offer franchises in the true sense of the word, they have a number of flexible programs that allow individuals to operate in various markets. Starbucks kiosks that are located on college campuses, hospitals, airports and hotels are independently operated.

One of the best reasons to own a franchise involves the ability to take advantage of name recognition. The Starbucks mermaid, who is soon to appear on every paper cup, ceramic mug and carryout bag sans product name, has proven to be a gold mine of profit for its corporate owners. In four years, company revenues jumped from just under a billion dollars to $2.6 billion annually. One way for an individual to jump on the Starbucks coffee express train is to obtain a license to sell Starbucks products in an existing establishment. In addition to packaged coffee beans—whether whole or ground—the company also puts its name on cold, canned coffee drinks, breath mints, candy bars, ice cream treats, and anything else that either contains coffee or is likely to be found in a coffee shop. There are Starbucks-brand travel mugs, tote bags, coffee grinders, and home espresso machines. If someone operated a retail store or a public venue, that establishment is a likely candidate to carry licensed Starbucks products.

A very prominent joint venture occurred when founder Howard Schultz involved his company’s joint-venture agreement with the giant bookseller, Barnes & Noble. Beginning in 2000, practically every bookstore the company opened employed the store-within-a-store concept that has since spread to other types of businesses. A Starbucks coffee shop, run by bookstore employees, occupies a prominent location in the center of many stores or alongside the magazine racks. This has also been seen in Supermarkets with a small Starbucks island located near in the entrance to Vons or Albertsons.

Starbucks
helped to pioneer the business model where the upscale coffee shop is a fixture in nearly every city and town across the United States. While Starbucks cannot be obtained as a franchise, there are plenty of other well-known brands out there for potential entrepreneurs to explore. Coffee Beanery asks for an up-front franchise fee of $27,500 and a total investment roughly between $70,000 and $500,000. Mountain Mudd Espresso offers a drive-up kiosk franchise for a cash investment of less than $100,000 and total costs of between $66,000 and around $200,000. The fee to open a Nestle Toll House Café is $30,000, the total investment will run a franchisee from between $165,000 and $425,000. So have no fear, thanks to capitalism, the choices are never limited.







 



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