Investing in a franchise can be a great way to enter the food and beverage industry with an established brand and a loyal customer base. One of the newest and most popular franchises is CHEEGE, known for its innovative milk tea and fresh beverages.
This article will explore the franchise costs, profit potential, and requirements for owning a CHEEGE franchise in 2024. If you’re curious about whether this franchise is right for you, keep reading for detailed insights.
1. CHEEGE Franchise Cost
Understanding the cost of opening a CHEEGE franchise is the first step in determining if this business opportunity aligns with your financial resources and goals. Below, we’ll break down the primary costs associated with starting your own CHEEGE store.
Initial Franchise Fee
The initial franchise fee is a one-time payment made when signing the franchise agreement. This fee grants you the rights to use CHEEGE’s brand name, trademarks, and proprietary systems. In 2024, the estimated initial franchise fee for CHEEGE ranges between $25,000 and $30,000, depending on the location. The fee also covers initial training for you and your staff to ensure that your store meets the company’s standards from day one.
Store Setup and Equipment Costs
Setting up your CHEEGE store involves purchasing equipment, furniture, and décor that match the brand’s modern and sleek aesthetic. Equipment such as tea brewers, milkshake machines, refrigeration units, and blenders will be necessary for creating CHEEGE’s signature drinks. The total cost for setting up a store, including equipment, is projected to range from $50,000 to $70,000, depending on the size and location of your store.Furniture and decor are equally important to give your store the right ambiance. CHEEGE’s signature style is bright, welcoming, and trendy, so budgeting for quality furnishings is key to creating a store environment that attracts customers.
Rent and Utilities
The cost of rent varies greatly depending on where your store is located. A prime location in a high-traffic urban area can be much more expensive than a smaller town or less busy location. On average, rent for a CHEEGE store can range from $2,500 to $10,000 per month. It’s essential to choose a location with good visibility and accessibility to maximize foot traffic.Additionally, utilities such as electricity, water, and internet services are ongoing operational costs that should be considered. Monthly utilities can run between $1,500 and $3,000, depending on the size and efficiency of your store.
Inventory and Ingredients
To keep your store fully stocked and operational, you’ll need to budget for inventory, including tea leaves, milk, flavorings, fruits, and other key ingredients used in CHEEGE’s beverages. For initial inventory, you can expect to spend between $4,000 and $6,000. After the grand opening, your monthly inventory costs will depend on the volume of customers and sales.CHEEGE is known for using high-quality ingredients, so it’s crucial to maintain a good stock of fresh and top-tier supplies to keep customers coming back for more.
Marketing and Advertising
A successful CHEEGE franchise relies on local and national marketing efforts to draw in customers. Franchisees are often required to contribute to a national marketing fund, which is usually a percentage of monthly gross sales. This is expected to be around 2% to 3%. Additionally, you’ll need to invest in local advertising efforts, especially during the store’s launch phase. This can range from $5,000 to $10,000 for the first few months.Brand consistency is key in franchising, and the CHEEGE corporate team typically provides guidelines and resources to help you market your store effectively within your local community.
Ongoing Royalties and Fees
Like most franchises, CHEEGE charges its franchisees ongoing royalty fees. These fees are a percentage of your store’s monthly sales and go towards supporting corporate operations, research, and further brand development. The typical royalty fee for CHEEGE franchises in 2024 is expected to be around 6% to 8% of gross monthly sales.In addition to royalties, franchisees may be responsible for contributing to technology or system maintenance fees, though these costs are typically minimal compared to other expenses.
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In addition to financial requirements, CHEEGE has specific conditions that all franchisees must meet. These conditions ensure that the quality of the brand is upheld across all locations and that franchisees are set up for success.
Experience and Background
CHEEGE does not require previous experience in the food and beverage industry, but having a background in retail, business management, or customer service can be beneficial. The franchise provides extensive training to all new owners, making it accessible for newcomers. However, the ability to manage a team, handle finances, and maintain excellent customer service is important for long-term success.Franchisees who lack experience but are willing to learn can still thrive, as CHEEGE offers support systems that help owners navigate the challenges of running a store.
Location Approval
Location is critical to the success of any CHEEGE franchise. Franchisees must get approval from the corporate team regarding their store’s location. CHEEGE prefers high-traffic areas such as shopping malls, busy streets, or near schools and universities where younger demographics frequent.The company may require franchisees to submit several potential locations for review. Only after the location is approved can the process of store setup begin. This ensures that the location aligns with the target market and will attract enough customers to be profitable.
Store Layout and Size
CHEEGE stores are designed to be sleek, modern, and welcoming. Franchisees must adhere to corporate design guidelines to ensure brand consistency. Most stores range from 500 to 1,500 square feet, with ample seating and a layout that allows for efficient customer flow.CHEEGE corporate provides design assistance to make sure each store’s interior meets brand standards. The cost of implementing these design elements can vary but is necessary to maintain the brand’s image.
Staffing Requirements
Running a successful CHEEGE franchise requires a capable and dedicated team. Typically, a CHEEGE store needs five to ten employees to operate efficiently, including baristas, cashiers, and store managers. Staff members must be trained to prepare drinks according to CHEEGE’s strict standards and provide excellent customer service.The company offers training for franchisees and staff to ensure consistency across all locations. A good manager who can oversee day-to-day operations is also crucial, especially if the franchisee is not able to be on-site every day.
Financial Stability
CHEEGE requires franchisees to have a certain level of financial stability to ensure they can sustain the business, especially during the startup phase. Typically, a net worth of $300,000 and liquid assets of at least $100,000 are required to qualify for a CHEEGE franchise.The company wants to ensure that franchisees have enough capital not only to cover startup costs but also to sustain the business during slower months or until profitability is achieved.
3. CHEEGE Franchise Process
If you’re interested in starting a CHEEGE franchise, there are several steps involved in the process, from initial research to the grand opening of your store. Here’s a breakdown of what you can expect.
Initial Inquiry and Research
The first step in the process is contacting CHEEGE and requesting more information about the franchise opportunity. At this stage, it’s important to do your own research as well—visit local CHEEGE stores, read online reviews, and get a feel for the customer experience and product offerings.Once you’ve gathered enough information, you can decide if this franchise aligns with your business goals and financial capabilities.
Application and Review
After expressing your interest, you’ll need to fill out a franchise application. This application will ask for details about your background, experience, and finances. The corporate team reviews your application to determine if you meet their criteria for franchise ownership.If your application is approved, you’ll move forward to the next steps in the process.
Franchise Disclosure Document (FDD)
Once approved, you’ll receive the Franchise Disclosure Document (FDD), which provides detailed information about the franchise agreement, costs, obligations, and potential earnings. It’s essential to review the FDD thoroughly, as it outlines both your responsibilities and what you can expect from CHEEGE as a franchisee.Many prospective franchisees choose to have an attorney review the FDD to ensure they fully understand the terms before moving forward.
Interviews and Final Approval
Next, you may be invited to an interview with the CHEEGE corporate team. This is an opportunity for both parties to get to know each other and ensure that you’re a good fit for the brand. If the interview goes well, you’ll receive final approval to move forward with the franchise agreement.
Signing the Franchise Agreement
Once you’ve been approved and are comfortable with the terms outlined in the FDD, you’ll sign the franchise agreement. This contract formalizes your relationship with CHEEGE and outlines the terms of your franchise, including fees, royalties, and operational guidelines.After signing the agreement, the next steps involve setting up your store and preparing for the grand opening.
Training and Store Setup
After signing the franchise agreement, you and your team will undergo comprehensive training provided by CHEEGE. This training covers everything from beverage preparation to customer service and inventory management.At the same time, you’ll work on setting up your store, including purchasing equipment, designing the interior, and securing inventory. CHEEGE provides support during this phase to ensure that your store meets all brand standards.
Grand Opening and Ongoing Support
Once your store is ready, it’s time for the grand opening. CHEEGE often provides marketing support during the launch phase to ensure a strong start. After the grand opening, you’ll continue to receive ongoing support from the corporate team, including help with marketing, inventory, and operations.
4. CHEEGE Franchise Advantages
Owning a CHEEGE franchise comes with numerous benefits, from brand recognition to ongoing support from the corporate team. Below are some of the key advantages.
Established Brand Name
One of the biggest advantages of franchising with CHEEGE is the brand’s established reputation. CHEEGE has already built a loyal customer base, making it easier to attract customers to your store. This gives franchisees a head start compared to opening an independent milk tea business.Franchising with a recognized brand like CHEEGE means you benefit from their ongoing marketing efforts, which help keep the brand top-of-mind for customers.
Proven Business Model
CHEEGE has a proven business model that has been successful in multiple locations. Franchisees benefit from a tested system, which reduces the risk involved in starting a new business. With training, support, and a clear operational framework, franchise owners are set up for success from the beginning.
Ongoing Corporate Support
From initial training to ongoing assistance, CHEEGE offers comprehensive support for franchisees. The corporate team is always available to help with operational challenges, marketing strategies, or any issues that arise during the course of business.This ongoing support helps franchisees feel confident and well-equipped to manage their stores effectively.
Potential for High Profit Margins
CHEEGE’s beverage-focused business model allows for high-profit margins. Milk tea, in particular, has relatively low ingredient costs, but customers are willing to pay premium prices for unique and high-quality drinks. Franchisees who manage their stores effectively can see significant returns on their investment.Additionally, the growing popularity of milk tea and fresh beverages means that customer demand is consistently strong, providing a solid revenue stream.
Flexibility in Store Locations
CHEEGE offers flexibility when it comes to store location. While high-traffic areas like shopping malls or near universities are ideal, franchisees can also succeed in less traditional locations, such as within office complexes or as standalone kiosks.This flexibility allows franchisees to choose locations that fit their budget while still attracting plenty of customers.Conclusion
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