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    4 Replies Latest reply on Jan 2, 2015 5:44 PM by JerryChau

    Bubble tea franchise Vs independent shop

    drogones12 Wayfarer

      I have a good location in a high traffic volume mall. Should I do bubble tea Chatime franchise or independent shop? The franchise cost about 45k more than an independent shop. There are quite a few of asian people in the mall. I just don't know people will care about Chatime franchise. Thank you in advance

        • Re: Bubble tea franchise Vs independent shop
          Moderator Rebecca Guide

          Hi drogones12, welcome to our community!   There are many things to factor into your decision as to become a franchise or independent shop, especially the franchise fees that you mentioned.  Ultimately, you must run your analytics to determine if by becoming a franchise would you make at least 45K more a year?  As a franchisee will your franchiser run advertisements for you, and if so, how broad of a range will it cover (media, online, print, etc)?

           

          Here are a couple of expert articles that you might be interested in reading and find helpful: Avoiding Franchise Failures: Doing due diligence on an established business model and Five Franchise Pitfalls to Avoid.  We hope you find these helpful.  Feel free to browse our forum for other informative articles as well as our discussion forums as well to see what others have experienced.

           

          Hopefully, some of our other members will jump in with some advice for you as well.

           

          Best of luck,

          -Rebecca

          • Re: Bubble tea franchise Vs independent shop
            david f. Wayfarer

            Hi Jason,

             

            I won't suggest franchising because it's cost and restriction as well as limit support coverage from those company based mainly in Asia. I rarely see any of those Franchise is actively promoting their brand name here in the US.

             

            My best suggestion is to create your own brand name and eventually if it does become successful you can even consider franchising it out yourself.

             

            If you need help creating your own bubble tea shop from scratch, please look at our company's service in business consultation (Classes) on how to open a bubble tea shop.  Bubble Milk Tea Classes, Boba Tea Training Course, Professional Business Consultant - Fanale Drinks

            • Re: Bubble tea franchise Vs independent shop
              icetzou Scout

              Again? Didn't I reply to a similar question a year ago?

               

              I own 5 bubble tea locations of my own brand since 4 years ago, here is the break down for you.

               

              Franchise:

              PRO:

              Instant brand recognition

              Marketing

              Recipes

              Operation Manual

              CON:

              No freedom in menu options

              Required to purchase from franchise wholesaler

              High royalty+ marketing fees

              May lose the right to use the name

               

              Even though creating your own brand sounds a lot more exciting and sexy, but in reality it's very very hard to do, especially bubble tea. Please search "boba" and read up on my replies to the other questions. It paints a pretty good picture of the industry. email me at info@bobabear.com if you need additional help.

               

              HAPPY NEW YEAR EVERYONE!

              • Re: Bubble tea franchise Vs independent shop
                JerryChau Tracker

                Dear Drogones,

                 

                As savvy lenders, such as Bank of America would do, I’ve checked FranData’s Franchise Registry. There is no record of Chatime requesting to be listed. I’ve also checked with the U.S. Small Business Administration’s most recent list of franchise loan approvals. Again, no sign of Chatime.

                 

                So my sense is that the UK-based brand in not serious (or experienced) about operating its franchise system in America.

                 

                Back to your question: “Should I do bubble tea Chatime franchise or independent shop?”

                 

                I recommend that you log on to http://www.chatimeuk.com/ and click the Franchise Opportunity button. Give them your contact information and request its franchise disclosure document (FDD), as required by the Federal Trade Commission. It will detail what the franchisor intends to do for you, how much you’ll need to invest and, perhaps most importantly, a list of all franchisees --- existing and those who have failed. Call them and ask if Chatime is a good deal and if it’s worth the up-front cost and ongoing royalties.

                 

                Even if you don’t buy the franchise, the FDD will give you a sense about what you’ll have to do if you go it alone without a franchise. And, what’s more, you can find free business mentoring near you at score.org, a women’s business center or small business development center to guide you toward a successful venture.

                 

                Whichever you chose, I wish you all the best and a happy, healthy and successful New Year. (-:

                 

                Jerry Chautin, former entrepreneur and business lender

                SCORE certified business mentor, coach, counselor

                SBA’s 2006 national Journalist of the Year

                Financial content provider --- blogs, websites