Paris Baguette Franchise Costs, Fees & Owner Salary (2023)

INVESTMENT

$653,000

-

$1,751,000

LOCATIONS

102

Emily

Updated

April 11, 2024

Is

Paris Baguette

a franchise?

Yes,
Paris Baguette
currently
accepts
franchise
applications

Paris Baguette is a multinational chain of bakery cafes that offers a variety of fresh baked goods, pastries, cakes, sandwiches, coffee, food, hot and cold beverages, and other products.

The chain was established in 1986 as a subsidiary of Shani Co., Ltd., with its country of origin being South Korea and its parent company being SPC Group, a South Korean conglomerate.

Paris Baguette began franchising in 1988, expanding its presence into the United States, Vietnam, and Singapore, making it a global company. Its US headquarters is located in Moonachie, New Jersey.

As of 2022, Paris Baguette operates 82 franchises in the US and has 3,742 locations globally. The company is dedicated to continued expansion and providing high-quality, freshly made foods. In pursuit of this goal, Paris Baguette has announced plans to open 64 new units in 2023 and aims to reach the 1,000-unit mark in the United States by 2030.

How many

Paris Baguette

franchises

are there?

In 2022, there were
102
outlets in
the United
States, of which
82
are franchises, and
20
are corporate-owned.

What are the

Paris Baguette

franchise

fees?

Advertising fee

3.00%

Initial Franchise Fee ($50,000)

The initial franchise fee for a Paris Baguette franchise is $50,000 for a single Paris Baguette Cafe. If the Cafe subject to this Agreement is developed pursuant to an Area Development Agreement, or if this is the second or any subsequent Franchise Agreement between Paris Baguette and the franchisee, the Initial Franchise Fee shall be discounted to $40,000.

Royalty Fee (5% of Gross Sales)

Franchisees are required to pay a continuing royalty fee equal to five percent (5%) of the weekly Gross Sales of the Franchised Restaurant.

Advertising Fee (2% to 3% of Gross Sales)

Franchisees are obligated to contribute towards advertising and marketing efforts. This includes a contribution of 2% of weekly Gross Sales to the Marketing Fund and an additional 1% of Gross Sales for local advertising.

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

Paris Baguette

franchise?

It costs between
$653,000
and
$1,751,000
to start a
Paris Baguette
franchise.

The total estimated initial investment for a single Paris Baguette Cafe ranges from $652,565 to $1,750,900. Below is a detailed breakdown of the costs involved, providing potential investors with a clearer picture of the financial commitment required.

Type of Expenditure Amount
Initial Franchise Fee $50,000
Real Estate or Advance Rent $10,000 - $90,000
Building Costs/Leasehold Improvements $250,000 - $1,000,000
Equipment and Fixtures $167,956 - $242,800
Signs $19,500 - $49,000
Smallwares $25,000 - $30,000
Point of Sale System, Hardware, Software and Surveillance Equipment $8,000 - $14,500
Opening Inventory $36,000 - $48,000
Grand Opening Promotion $10,000 - $10,000
Licenses, Permits, Fees and Deposits $4,510 - $18,710
Miscellaneous Expenses $11,159 - $16,500
Insurance $3,405 - $4,890
Attorneys’ Fees and Business Consultants $3,035 - $7,500
Travel and Living Expenses While Training $20,000 - $65,000
Cost of Goods During Training $4,000 - $4,000
Additional Funds for First 3 Months of Operation $30,000 - $100,000
Total $652,565 - $1,750,900

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

Paris Baguette

provide

training

to its

franchisees?

Yes,
Paris Baguette
provides
training

Here's a detailed look at what they offer to their franchisees:

Training Program: Paris Baguette offers a comprehensive training program that combines various learning methods, ensuring that franchisees are well-prepared with the necessary knowledge and skills to operate their bakery.

Who Needs to Attend: The franchisee's Operating Principal, Cafe Manager, and between eight (8) to ten (10) food production personnel are required to attend and successfully complete the initial training program.

Training Content: This includes sales techniques, product orientation, accounting procedures, food preparation, and operations management.

Location and Duration: The training is provided at locations designated by Paris Baguette. The Operating Principal and Cafe Manager will attend an eight (8) week operations training program that includes a mix of lectures, videos, assessments, and on-the-job training. Similarly, the food production personnel will attend an eight (8) week production-based training program.

Training Expenses: Paris Baguette provides the initial training program for the franchisee's initial Operating principal, Cafe Manager, and eight (8) to ten (10) food production personnel at no extra charge. However, franchisees will bear all other expenses incurred in attending the training.

Does

Paris Baguette

provides

territory

protection?

Franchisees do not receive an exclusive territory. They are granted a geographical area known as the "Protected Territory". Within this Protected Territory, Paris Baguette commits not to establish or grant a new franchise for the operation of a Paris Baguette Restaurant.

However, deliveries of goods, even if done by a third-party delivery service, to a customer located within the franchisee's Protected Territory from a Paris Baguette Restaurant situated outside of the Protected Territory are not considered a violation of the franchisee's territorial rights.

Franchisees may face competition from other franchisees, from outlets that Paris Baguette owns, or from other channels of distribution or competitive brands controlled by Paris Baguette.

Can a

Paris Baguette

franchise

be run as

a passive

investment?

Paris Baguette requires franchisees to designate an individual as the "Operating Principal." If an Area Development Agreement is signed, this Operating Principal must maintain a minimum direct or indirect ownership interest in the Area Developer and in each entity holding a franchise under it.

Franchisees can form subsidiary entities for each Cafe they develop, but these entities must have the same ownership and control as the entity that signs the Area Development Agreement.

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