Smoothies are quite popular health drinks alternatives in the United States. We all have been witnessing numerous brands coming in and serving some delicious varieties of shakes, salad, and more options.
If you are the one, who is willing to delve into this promising industry, then you should be really checking out this informative piece on the Smoothie King franchise. They have flexible investment model for everyone, ranging from $311,601 for the Endcap model to $762,400 for the free-standing model.
However, the question remains: is the initial investment truly worthwhile?
That will be answered for you in the upcoming section. Along with this, you’ll also learn more about the initial capital requirement breakdown, estimated profit margin, prior growth rate, and expansion strategy.
Table of Contents
What’s the Smoothie King franchise background?
Smoothie king is a popular American QSR chain that primarily deals in selling of varieties of flavorful smoothies. Steve and Cindy Kuhnau, the founders, established this brand in Louisiana in 1973, which originated from a simple experiment of mixing real fruit, nutrients, and proteins in a blender at home.
The positive changes were happening for them, so they decided to take this concept to the broader level.
At present, the Smoothie king has more than 1300 outlets across the globe, out of which 1000 are operating in the United States, and remaining of them are located in South Korea, Trinidad & Tobago, and other regions.
When did Smoothie king launched its first franchise?
The demand for healthier drinks was growing, and leveraging their proven smoothie recipe, the founder inaugurated their first franchise store in 1989.
Currently, at their store, one can avail a wide array of healthy cuisines, ranging from fruit juice, dairy, yogurt, and much more.
The franchise have now marked their presence in the industry as a pioneer smoothie destination among all its customers.
With its first store in 1989 to over 1300 outlets in 2023, Smoothie King have shown immense and growth potential in revenue, profit margin, and the customer’s demand. In terms of CAGR growth for their outlet expansion, they have exhibited a compounded annual growth rate of 22.82%.
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Who owns the Smoothie King franchise?
Despite of their wonderful journey with Smoothie King, the founders, Steve and Cindy Kuhnau, sold the entire business to Wan Kim in July 2012, who was the South Korean SK franchisee since 2002.
Currently, the chain operates under the brand name of SK USA, Inc., and business name as Smoothie King. Interestingly, the chain is still a privately-governed entity, with more than 100 stores across the South Korea.
To conclude, Wan Kim is the CEO of Smoothie King. Wan further acquired US$58 million from renowned equity and pension fund, which he utilized them in expanding their outlets to other part of the country.
Key facts about the Smoothie King
| Sr No. | Type | Private |
|---|---|---|
| 1 | Trade Name | Smoothie King |
| 2 | Industry | Smoothie retail chain |
| 3 | Founded | 1973 |
| 4 | Founders Or Parent Company | Wan Kim, CEO |
| 5 | Corporate Headquarters | United Staes |
| 6 | Number of units | Over 1350 |
| 7 | Area served | Worldwide |
| 8 | Model | Company owned and franchises |
| 9 | Menu offering | Smoothie, fruit juice, and more |
| 10 | Average Gross Sales | $862,839 |
| 11 | Website | https://www.smoothiekingfranchise.com |
Why should you choose Smoothie king franchise over other brand?
- Experienced and professional franchise team:
- Wan Kim, who was successfully operating multiple SK franchises in South Korea, purchased the entire brand from the founder, and then scaled it strategically to several locations.
- This can unquestionably help you in leveraging the brand’s reach and grabbing potential customers in your area.
- Wan Kim, who was successfully operating multiple SK franchises in South Korea, purchased the entire brand from the founder, and then scaled it strategically to several locations.
- Constantly evolving product range:
- The franchise is constantly evolving their menu range, and with competitive pricing, better digital marketing, and growing awareness for the healthier food options, it may provide a significant boost to the overall brand and its investors.
- Training and support:
- As a franchisee, you’ll receive all the necessary training and their onboarding process are pretty straightforward that can help any entrepreneur/franchise to understand the business and operate it smoothly.
How much does a Smoothie King franchise cost?
There are basically two different model for becoming a Smoothie king outlet owner.
If you are planning to become a Smoothie king outlet owner, you may need to invest at least $311,601–$638,465 for Endcap or inline location, and $762,400–$1,379,150 for the free-standing drive-thru location.
Once you are ready with your plan to partner with Smoothie king, you may need to pay an initial franchise fee of $25,000-$30,000 for the traditional model, and $15,000 for a non-Traditional Location. This is certainly included in the total investment.
Basic capital requirements
| Type of Capital | Cost and its details |
|---|---|
| Franchise fee | $25,000 – $30,000 and ($15,000 for a non-traditional location) |
| Required Net Worth | $350,000 |
| Available liquidity | $150,000 |
| Royalty fee | 6% of weekly gross sales |
| Marketing fee | 3% of weekly gross sales |
| Advertising fee | 2% of weekly gross sales |
| Total initial capital | Endcap or In-Line Location: $320,301 to $585,465 Free-Standing Drive-Thru Location: $723,501 to $1,184,865 |
Cost breakdown for the End-cap or In-line model
| Types of Expenditures | Amount |
| Initial Franchise Fee | $25,000-$30,000 ($15,000 for a non-Traditional Location) |
| Three Month’s Rental & Deposit | $5,000-$25,000 |
| Technology Systems | $9,100-$12,215 |
| Grand Opening Marketing | New Unit Minimum of $15,000 for Traditional Units and $7,500 for Non-Traditional Units |
| Travel and Training Expenses | $1,000-$6,000 |
| Insurance(First Year’s Premium) | $2,500-$7,500 |
| Other Prepaid Expenses | $1,000-$2,500 |
| Start-Up Supplies, Inventory | $23,000-$24,000 |
| Furniture, Fixtures & Equipment, Millwork and Graphics | $80,000-$140,000 |
| Architectural & Engineering Professional Service | $3,500-$14,500 |
| Signage | $5,000-$14,000 |
| Leasehold Improvements | $135,000-$280,000 |
| Legal, Accounting & Organizational Costs | $500-$4,000 |
| Miscellaneous Costs | $1,000-$5,000 |
| Drive Through | $0-$33,750 |
| Additional Funds 3 Months | $5,000-$25,000 |
| Total | $311,601-$638,465 |
Cost breakdown for the Free-standing drive-thru location
| Types of Expenditures | Amount |
| Initial Franchise Fee | $25,000-$30,000 ($15,000 for a non-Traditional Location) |
| Three Month’s Rental & Deposit | $5,000-$30,000 |
| Technology Systems | $12,000-$14,500 |
| Grand Opening Marketing | New Unit Minimum of $15,000 for Traditional Units and $7,500 for Non-Traditional Units |
| Travel and Training Expenses | $2,700-$6,000 |
| Insurance(First Year’s Premium) | $3,500-$7,500 |
| Other Prepaid Expenses | $14,700-$29,400 |
| Start-Up Supplies, Inventory | $23,000-$24,000 |
| Furniture, Fixtures & Equipment, Millwork and Graphics | $100,000-$130,000 |
| Architectural & Engineering Professional Service | $42,000-$52,000 |
| Signage | $28,000-$38,000 |
| Leasehold Improvements | $450,000-$875,000 |
| Legal, Accounting & Organizational Costs | $500-$4,000 |
| Miscellaneous Costs | $1,000-$5,000 |
| Drive Through | $25,000-$33,750 |
| Additional Funds 3 Months | $15,000-$25,000 |
| Total | $762,400-$1,379,150 |
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How much does the average smoothie king franchise make?
In 2009, before the Wan Kim even purchased the entire entity, the average smoothie king outlet were generating a revenue of $285,000, which scaled to $362,000 by 2012.
The systemwide sales were growing at the tremendous rate and few collaborations of Smoothie king with NBA further boosted their topline and the bottom-line.
According to the official website, the average gross sales for the outlet was at $862,839 for the calendar year ending December 2022, which is primarily contributed by the top 25% (around 231 outlet) of all the traditional franchises.
The franchise also states that the out of 231 outlets, 85 of them have exceeded the expected average gross sales. Therefore, the franchise is growing and rapidly evolving demand for healthier food option may help the chain to register impressive numbers in the upcoming years.
Are smoothie king franchises profitable?
If you are looking for the details about the franchise’s profitability, then you should probably check its latest franchise disclosure document(FDD).
As per the latest FDD, the average Smoothie king outlet generated an AUV of $561,000 with an average EBITDA margin of 13.5%. Therefore, based on this calculation, an average outlet will make a yearly income of ~$73,000.
This way, to recoup the initial investment of ~$762,400 for the drive-thru concept, you may need to wait for the 10 years (Payback period). But again for the end-cap model, the gap could be larger.
Moreover, these numbers are basically calculated based on the average revenue figures and they are bound to changes frequently. Therefore, we request you to kindly get in touch with the company official to get the latest information on the payback period.
Alternative to Smoothie King
There are several alternatives available to Smoothie king franchise, and they are listed down for your reference
- Plant smoothie
- Tropical smoothie cafe
For more options, you can check out this piece, Smoothie and Juice franchise
Wrapping Up
The entire concept of having healthier food options are booming and today we have multiple franchise options available in the market.
However, with the experience like Smoothie king and its investment range, one can certainly have a look on it. Additionally, before taking future steps, you should obviously schedule a call with the SK franchise team, and understand their future growth plans.
Important links:
| Apply Here | Application form |
| Phone number | (877)927-6104 |
FAQ
Is Smoothie king a franchise?
Smoothie King is definitely a proven a leading franchise brand, dealing in offering a wide range of smoothie bowls, desserts, fruit juice, and more.
How many franchises does smoothie king have?
As per latest dataset of 2024, the smoothie king has over 1350 outlets throughout the globe and 100+ stores are planned for future release.
What’s the required net worth to open a smoothie king?
To obtain a license for becoming a Smoothie king outlet owner, you’ll need to have a net worth of $350,000 and liquidity of $150,000.
