Menchie's Franchise Costs, Fees & Owner Salary (2023)

INVESTMENT

$143,000

-

$471,000

LOCATIONS

318

Emily

Updated

April 11, 2024

Is

Menchie's

a franchise?

Yes,
Menchie's
currently
accepts
franchise
applications

Menchie's Frozen Yogurt, established in 2007, quickly became a prominent player in the self-serve frozen yogurt industry. By 2008, Menchie's had already started offering franchising opportunities, rapidly expanding its global presence and becoming synonymous with a fun and engaging customer experience.

 Known for its welcoming and family-friendly atmosphere, Menchie's invites customers to create their own frozen yogurt mixes, offering a wide array of flavors and toppings​​​​.

The brand differentiates itself through its commitment to quality and community, focusing on creating memorable experiences for guests and franchisees alike. Menchie's is headquartered in Encino, California, and operates under the umbrella of Menchie's Group, Inc. 

For those interested in becoming part of the Menchie's family, the franchise offers comprehensive support, including training and marketing assistance, to ensure the success of each store. Menchie's continues to grow, thanks to its innovative approach to frozen yogurt and its dedication to spreading smiles and creating positive community impacts​​​​.

How many

Menchie's

franchises

are there?

In 2022, there were
318
outlets in
the United
States, of which
317
are franchises, and
1
are corporate-owned.

What are the

Menchie's

franchise

fees?

Advertising fee

2.00%

Initial Franchise Fee

The Initial Franchise Fee is set at $40,000, which is required to be paid by the franchisee upon signing the franchise agreement. This fee grants the franchisee the right to use the franchisor's brand and access the franchisor's business systems and support.

Royalty Fee

Franchisees must pay a Royalty Fee, which is the greater of $125 or 6% of Gross Sales. This fee is designed to provide ongoing revenue to the franchisor in exchange for continuous support and the use of the brand.

Marketing Fee

A Marketing Fee of 2% of Gross Sales is required from franchisees to contribute towards collective marketing efforts that benefit the entire franchise network, helping to drive brand awareness and customer traffic.

Additional Training Fee

The Additional Training Fee is determined based on the specific training requirements but will not exceed $500 per person per day. This fee covers the cost of any additional training that franchisees or their staff may require.

Operations Manual

Franchisees are required to pay $500 for the Operations Manual, which contains the franchisor's proprietary operating procedures, standards, and guidelines.

Renewal Fee

The Renewal Fee is 25% of the then-current franchise fee, payable by franchisees wishing to renew their franchise agreement at the end of its term.

Technology Fee

A Technology Fee of $80 per month is charged to franchisees to cover the costs associated with the use of the franchisor's proprietary technology and systems.

Transfer Fee

The Transfer Fee is set at 10% of the franchisor's then-current franchise fee and is payable when a franchisee wishes to transfer their franchise rights to another party.

Note: The fees presented here can be found in the Item 5 of the Franchise Disclosure Document. For a complete list of all the fees borne by the franchisee, please consult the Franchise Disclosure Document.

How much does

it cost

to start a

Menchie's

franchise?

It costs between
$143,000
and
$471,000
to start a
Menchie's
franchise.
Type of Expenditure Amount
Initial Franchise Fee $40,000
Travel and Living Expenses While Training $625-$2,600
Lease Deposit and Rent $1,593
Leasehold Improvements $56,230-$205,570
Computer (POS) System $5,735-$5,850
Signage $3,435-$8,475
Opening Inventory $5,300-$7,300
Uniforms, Merchandise, Equipment and Sales $1,000
Grand Opening Marketing $3,000
Utility Deposits, Professional Fees, Business Licenses, etc. $200-$3,700
Insurance (3 months) $1,000-$1,500
Inspection Fee $0-$1,500
Additional Funds—3 Months $6,000-$36,000
Total $142,683-$471,087

Note: The table above provides a snapshot of the main costs associated with starting the most common franchise format (as disclosed in the Item 7 of the Franchise Disclosure Document). For a complete overview of all the expenses involved with the various formats offered by the franchisor, please consult the Franchise Disclosure Document.

Does

Menchie's

provide

training

to its

franchisees?

Yes,
Menchie's
provides
training

The franchisor provides comprehensive training for Menchie's franchisees, covering various operational aspects of running a franchise. The training program includes:

  1. Pre-Opening Assistance: Before opening the store, the franchisor provides site selection criteria, design requirements, lists of approved supplies and suppliers, and an Operations Manual. The franchisee is also enrolled in the "Circle of Success Program," which includes recorded webinar sessions focusing on key operational areas.
  2. Initial Training: The franchisor conducts an initial training program for the franchisee or their Operating Partner and one manager-level employee. This training is provided without charging a fee and covers subjects such as culture, guest care, and product knowledge. The training takes place over several days at the franchisor's training facility in Los Angeles, California, or another designated location. Additional attendees beyond the first two may join the training for a fee, and all attendees are responsible for their travel, living expenses, and wages.
  3. Ongoing Training: The franchisor may require franchisees, store managers, and key employees to attend ongoing training sessions at the franchisor's training facility or other designated locations. These sessions may cover new products, services, operational procedures, or refresher courses. The franchisor may charge a fee for manager training, not exceeding $500 per person per day, and franchisees are responsible for all related expenses.
  4. Annual Meetings and Conferences: Franchisees are required to attend annual franchisee meetings, conventions, or conferences to stay updated on new products, services, and operational strategies. These events are at the franchisee's expense, including travel and accommodation costs.

Does

Menchie's

provides

territory

protection?

The Menchie's franchise does not offer an exclusive territory. Franchisees may face competition from other franchisees, company-owned outlets, or other channels of distribution or competitive brands controlled by the franchisor. The franchise is granted for a specific approved location, and franchisees are expected to operate only at this location. They are not allowed to operate or accept orders outside of their designated territory without the franchisor's permission.

While franchisees are granted a "Designated Territory," typically defined as a 2-mile radius around the restaurant, there are specific locations excluded from this territory where the franchisor reserves the right to develop or franchise restaurants. These include military bases, public transportation facilities, sports facilities, student unions on college campuses, amusement and theme parks, and special events ("Special Sites").

The boundaries of the Designated Territory might also be influenced by major topographical features.During the term of the franchise agreement, as long as franchisees comply with its terms and conditions, the franchisor will not modify the Designated Territory or establish a company-owned or franchised Menchie's store inside the Designated Territory.

Can a

Menchie's

franchise

be run as

a passive

investment?

Franchisees must have sole responsibility and authority over the day-to-day operation of their store, which includes the employment, supervision, and discharge of employees, as well as maintaining daily operations and safety standards. Franchisees are also expected to achieve business objectives and ensure conformity with the Menchie's system.

Furthermore, franchisees or their owners are prohibited from engaging in or having a financial interest in any competitive business during the term of the agreement without Menchie's prior written consent, indicating a commitment to the franchise.

If the franchisee is a corporation, limited liability company, partnership, or other legal entity, an "Operating Partner" must be designated. This Operating Partner must be an individual who owns and controls not less than 5% of the equity and voting rights in the franchisee entity, has completed Menchie's initial training program, and has the authority to bind the franchisee in dealings with Menchie's.

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