Can you Buy A Sweetgreen Franchise: Alternatives, Cost, & Profit

If you have been looking to venture into the fast-casual restaurant business in the United States, Sweetgreen might have caught your attention.

Undoubtedly, the fast-casual restaurant industry is growing at a rapid pace, and the United States, being a world leader in the industry, holds the majority of growth prospects in this sector.

According to the Globenewswire, the overall fast-casual industry is poised to be valued at $55.4 bn during 2022-2027, showcasing a CAGR growth rate of 11.56% during the mentioned period.

Over the last few years, consumers haven’t been craving random and unhealthy foods. Instead, they have been more concerned about the nutritional value of each meal.

This timely change in the dining pattern has led to the emergence of certain brands that cater to the growing demand of American consumers. One such example is SweetGreen.

If you have recently visited a SweetGreen outlet and have been piqued by your interest in partnering with them to start your own outlet in the locality, then you should consider reading this informative piece.

In this comprehensive post, we’ll delve into the details of Sweetgreen franchise, along with its estimated initial cost, growth strategy, profit potential, and a few alternatives to it.

Additionally, we’ll answer some of the frequently asked questions about this franchise. Before we start, we request you to read the complete article so that you don’t miss any important details of Sweetgreen.

• Brand: Sweetgreen
• Founded: 2007
• Founder: Nicolas Jammet,
  Nathaniel Ru, and Jonathan Neman
• Industry: Fast-casual restaurant
• No. of outlet: 221+
• Area served: United States
• Franchise Fee: NA
• Royalty Fee: NA
• Model: Company-owned model
• Est. Initial Investment: $1.8 million to $2 million

Overview of Sweetgreen Franchise?

Sweetgreen was official founded in 2007 by three aspiring entrepreneurs, Nicolas Jammet, Nathaniel Ru, and Jonathan Neman, who were disappointed with campus food options.

All three of them were students at Georgetown University who conceptualized the model of Sweetgreen in 2006 and later opened its first outlet in Washington, D.C. in 2007.

The chain serves a delicious range of freshly prepared salads and grain bowls – all prepared with locally-sourced ingredients and a wide range of seasonings.

With strong emphasis on raw material procurement and dedication to serving solely healthy food options, Sweetgreen is on the verge of acquiring a significant customer base and marking its position as an industry leader. In fact, Sweetgreen is a prominent player in the fast-casual restaurant industry.

As per the latest update, Sweetgreen boasts a presence of over 221 outlets acorss the country, with majority of them are located in California (41 outlets).

Additionally, the chain has planned to open another 30-35 new restaurants and is forecasting to reach a revenue figure of approximately $575 million to $595 million.

Though Sweetgreen has set its 2023 goal, but does it offer franchises or can we buy one of their locations? Stay with us, and we’ll answer everything in this.

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The Journey of Sweetgreen

Back in 2006, three friends from Georgetown University shared a common frustration: the lack of healthy food options both on campus and in their local neighborhood.

They scoured the area but found quite limited, unhealthy, and pricey choices. Determined to change the status quo, this dynamic trio conducted thorough research and analysis, leading to the birth of their very first Sweetgreen outlet in the heart of Washington D.C.

It’s worth noting that their strategic location choices and dedication to serving healthy food have propelled the chain to expand to over 221 outlets, with a target revenue of at least $575 million.

Key facts on Sweetgreen

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Why consider opening a Sweetgreen Franchise? (If offered)

1. Healthy food options:
   • Undeniably, Sweetgreen is a prominent brand in the fast-causal restaurant industry and with its delicious range of healthy and flavorful food option, one shouldn’t overlook this chain.
2. Year-on-Year growth in its revenue:
   • The franchise has shown remarkable year-on-year growth in its net revenue.
     • Starting from the ground up and reaching a revenue of $470 million in 2022, Sweetgreen is definitely worth a closer look.
3. Tech-led growth strategies:
   • As a leading brand, Sweetgreen has amassed a substantial customer base. Their innovative approach and seamless technology integration, enabling customers to order online or through their mobile app, are certainly noteworthy.
4. Pioneer in the fast-casual industry:
   • Sweetgreen has been operating its outlets since 2007, and its extensive experience of nearly one and half decades has helped the chain to understand the overall fast-casual industry and build a loyal customer base for their foods.
5. Growing awareness:
   • According to several research reports, there has been quite a shift among American consumers towards healthier food options.
     • This trend will eventually allow the brand to expand its presence and acquire a significant market share in quick time.

Does Sweetgreen Franchise?

Unfortunately, Sweetgreen doesn’t sell its franchises. Since its foundation in 2007, the chain continues to operate under the company-owned model and hasn’t sold any locations to aspiring entrepreneurs or businesses.

The chain is a public listed company and has pioneered in serving delicious range of bowls, salads, and other varieties of healthy food options.

Indeed, there has been continuous demand for its franchises, and despite its extensive experience in operating these outlets, the chain still wants to maintain control over its businesses and make their overall business profitable.

How much does a Sweetgreen Franchise Cost?

Currently, the Sweetgreen has a humongous presence of more than 221 fast-casual restaurants across the country.

However, the initial setup cost for each location is dependent on several factors, including the outlet geographical location, floor area for restaurant, average rent, and the amount required to furnish the selection premise.

Additionally, it’s worth mentioning that Sweetgreen still operates and expands solely through company-owned outlets. As of now, there are no plans to sell franchises.

The total restaurant operating costs for Sweetgreen in 2022 amounted to $400,819,000. In the same year, the chain had nearly 221 operational outlets, which amounts to an average initial operating cost for a single outlet of $1,813,660.

Nevertheless, considering its 2022′ Annual report, store model and locality, the initial investment cost to open a Sweetgreen franchise may range anywhere between $1.8 million and $2 million.

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How much is Sweetgreen Franchise Profit Margin?

The franchise boasts a robust presence of their outlets throughout the country and the profitability of every single outlet is highly dependent on the market growth potential, customer’s footfall at the outlet, average check price, and the overall outlook of the brand.

Let’s check out some of their peak highlights from their Quarterly report:

1. For the Second quarter of fiscal year 2023, Sweetgreen totaled a revenue of $152.5 million, which was at $129.9 million in the previous year, exhibiting a growth rate of 22%.
2. Same-Store Sales Change of 3%, versus Same-Store Sales Change of 16% in the prior year period.
3. In the same quarter, Restaurant-Level Profit reached $31.1 million, with a Restaurant-Level Profit Margin of 20%, marking an increase from the prior year’s figures of $23.1 million in profit and a 19% profit margin.
4. Additionally, the chain posted a net loss of $(27.3) million, versus net loss of $(40.5) million in the prior year period.
   • Adjusted EBITDA was $3.3 million, versus Adjusted EBITDA of $(7.8) million in the prior year period; and Adjusted EBITDA Margin was 2%, versus (6)% in the prior year period.

According to Jonathan Neman, Co-Founder and Chief Executive Officer, Sweetgreen achieved remarkable results, with a consistent 20% year-over-year sales growth for the ninth consecutive quarter.

Additionally, the company maintained a restaurant-level margin exceeding 20% and accomplished an Adjusted EBITDA profitability of $3.3 million.

Therefore, to conclude, despite of operating over 221 outlets and a revenue figure for the second quarter for the fiscal year 2023, Sweetgreen posted a net loss of ($27.3) million.

The primary reason for its losses was the rise in food and beverage costs and labor costs throughout the market.

However, the franchise anticipate that its restaurant-Level Profit Margin could range between 16% and 18% for the fiscal year 2023.

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What the requirements for the Sweetgreen Franchise? (if offered)

1. First and foremost, one should be financially well-qualified and have good credit to start a Sweetgreen location. Additionally, they should be prepared to invest a minimum of $1.8 million to $2 million.
2. You need to find a retail space of at least 2000 sq feet for Sweetgreen restaurants, located at high-traffic locations with a plenty of parking space.
3. One must possess excellent communication skills, be customer service-oriented, and value honesty and business ethics to become an approved Sweetgreen outlet owner.
4. Interested franchisees should have passion to work in the Food and Beverages industry and should possess the leadership and financial skills to operate a Sweetgreen restaurant.

What are the alternatives to Sweetgreen Franchise?

To be entirely accurate, there are several fast-casual restaurants in the market that offer bowls and salads and provide franchise opportunities.

One such example is Salad and Go (but again, it doesn’t sell franchises).

Let’s look at some prominent brands in the industry:

Salad and Go Franchise

Salad and Go was founded in 2013 in Gilbert, AZ. The chain is quite popular for its salads, wraps, soups, burritos, and other beverages.

Unlike Sweetgreen, Salad and Go remains to be privately-owned company and at present boasts a presence of nearly 100 stores across the country. Additionally, the franchise has planned to open another 30-35 restaurant by 2023, making their total store counts by 135.

The chain is currently being led by the Charlie Morrison (CEO) and under his leadership, Salad n Go has exhibited a phenomenal growth.

Despite of its privately-operated setup, Salad and Go grew into a popular brand and certainly competes with the brand like SweetGreen. You can check out our informative piece (link provided).

Read more: Can you own a Salad and Go Franchise? – A Complete Analysis, Cost, & Profit

Just Salad Franchise

In 2006, Just Salad was founded, coincidentally the same year as Sweetgreen. Currently, Just Salad owns and operates nearly 70 outlets countrywide.

The chain’s inception can be attributed to childhood friends Nick Kenner and Rob Crespi, who, like the trio of founders behind Sweetgreen, encountered a similar situation that inspired them to establish Just Salad in New York.

Along with its growing presence in the United States, the chain also opertes a few outlets in Dubai.

To become an approved Just Salad Franchise owner, one may need to have an initial investment of at least $357K – $753K, including a franchise fee of $30,000.

Currently, the chain isn’t seeking any application for its franchises. if you are intersted you can directly connect with them from mentioned link.

You can check that out – Just Salad

A few more opportunities that can be considered are – Tropical Smoothie Cafe Franchise, Jamba Juice, and Golden Chick Salad

How to Get Sweetgreen Franchise?

Currently, Sweetgreen doesn’t sell its franchises and is yet to embrace the franchise model. Furtheremore, it’s worthy noting that since its foundation, Sweetgreen remains to operate under a company-owned model.

However, you can become a shareholder by purchasing Sweetgreen’s shares on any of the exchanges. Sweetgreen is listed under the ticker name NYSE: SG and is currently trading at $11.34 as of September 2023.

To check with company directly:

1. Visit its official website and navigate to contact us page. (If franchise page is there, then click on that).
   • Fill in the necessary details like Name, Email ID, Phone Number, and more.

Final Takeaway – Conclusion

Sweetgreen is a pioneer brand in the fast-casual restaurant industry. Founded in 2007, with over 221 operational outlets and a diverse range of salad and bowl options, there’s no brand quite like Sweetgreen.

While there’s been enormous demand for its franchises, the company has currently refrained from adopting a franchise model.

Currently, the chain is a publicly listed company and operates over 200 outlets nationwide. Sweetgreen has also laid out its future plans to open another 30-35 restaurants, potentially bringing its total count to 250 by 2023.

Nevertheless, Talking about its profitability, Sweetgreen is burning cashes. The chain did manage to grow its revenue to nearly $422 million in 2022 but its end margins are still in red.

To conclude, Sweetgreen may seems like a lucrative investment opportunities, but none can buy its franchises; instead you can become their shareholder by purchasing stocks from the stock exchanges (You need to do your research before investing).

Good Luck!! Happy Franchising!!

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