Franchising Since: 1988
Headquarters: Coppell, Texas
Estimated Number of Units: 1,375
Franchise Description: The franchisor Smoothie King Franchises, Inc. The franchisor offers franchises for the operation of a unit, which sells a variety of premium, handcrafted smoothies made with select real fruit and organic vegetables, and nutritional supplements blended fresh using proprietary recipes. Units also offer consumers the benefit of nutritional retail merchandise, which includes vitamins, herbs, minerals, a myriad of supplements, and healthy snack items, among many others.
Training Overview: Franchisees must attend Smoothie King’s orientation and pre-opening training program as soon as reasonably possible after signing the Franchise Agreement and before beginning site selection. This program is mandatory and held at Smoothie King’s home office in Coppell, Texas or another location the franchisor designates, or virtually. The initial management training program is mandatory for all franchisees and managers. The initial management training course is up to 20 days, averaging eight hours per day plus additional homework assignments. The franchisor also will send one Smoothie King representative to the unit location, at no cost to the franchisee, for on-site training and assistance when the franchisee opens the unit. The length of time the representative is on-site may vary, but it is expected to be up to five days. The franchisor periodically will, as it considers necessary, provide franchisees with advanced training in operating the unit.
Territory Granted: Franchisees can operate a Smoothie King unit only from a specified location approved by the franchisor. The franchisor may designate a general geographic area solely to limit the area within which franchisees may seek a site location for the unit. Until franchisees have secured a lease and a protected territory is designated, the franchisor may establish franchised or company affiliate-owned Smoothie King businesses at any time in the general area that may compete with the unit that the franchisee operates and limit their ability to seek a site in certain parts of the general area. Once the franchisee has secured the lease for a traditional location, the franchisor will designate a geographical area surrounding the unit (the protected territory). The franchisor will not establish or operate a unit, nor grant a franchise to any person other than the franchisee to establish or operate a unit in the protected territory. The protected territory will be defined by identifiable boundaries and include a business, seasonal and/or residential population count of approximately 15,000 people, based upon the franchisor’s site selection data available at that time. The protected territory may include a business, seasonal and/or residential population count of less than 15,000 people where there is less than 15,000 people within a two-mile natural trade area of the location, such as in suburban, rural, or beach communities. If franchisees operate a Smoothie King from a non-traditional location, they will not receive a protected territory and will not have any protectable rights to an area or protected territory.
Obligations and Restrictions: Franchisees do not have to conduct on-premises supervision or personally participate in the direct operation of the unit. The franchisor recommends, however, that franchisees are actively involved in the operation of the unit. The unit that franchisees develop and operate must at all times be under the direct, full-time, on-location supervision of franchisees or a trained and competent employee acting as a full-time manager. Franchisees must offer and sell only those goods and services that the franchisor has approved. Franchisees must offer all goods and services at retail that the franchisor designates as required for all franchisees, including new products or services that Smoothie King develops in the future.
Term of Agreement and Renewal: The length of the initial franchise term is 10 years (or less for a non-traditional location at the franchisee’s election if the lease term is less than 10 years). Franchisees may renew their agreement for one additional term of 10 years, if requirements are met.
Financial Assistance: The franchisor does not offer direct or indirect financing. The franchisor does not guarantee a franchisee’s note, lease or obligation.
Investment Tables:
<small>*The estimated initial investment range covers from an end cap or in-line location up to a freestanding drive-thru location. Please see FDD for more details.</small>
| Name of Fee | Low | High |
|---|---|---|
| Initial Franchise Fee | $25,000 | $30,000 |
| Three Month’s Rental & Deposit | $5,000 | $30,000 |
| Technology System | $9,100 | $14,500 |
| Grand Opening Marketing | $15,000 | $15,000 |
| Travel and Training Expenses | $1,000 | $6,000 |
| Insurance (First year's premium) | $2,500 | $7,500 |
| Other Prepaid Expenses | $1,000 | $29,400 |
| Start-up Supplies, Inventory | $23,000 | $24,000 |
| Furniture Fixtures & Equipment, Millwork and Graphics | $80,000 | $130,000 |
| Architectural & Engineering Professional Services | $3,500 | $52,000 |
| Signage | $5,000 | $38,000 |
| Leasehold improvements | $135,000 | $875,000 |
| Legal, Accounting & Organizational Costs | $500 | $4,000 |
| Miscellaneous costs | $1,000 | $5,000 |
| Drive-Thru | $0 | $33,750 |
| Additional Funds—3 months | $5,000 | $25,000 |
| ESTIMATED TOTAL* | $311,600 | $1,379,150 |
| Type of Fee | Amount |
|---|---|
| Operating Fee | 6% of gross sales. Subject to a monthly minimum fee of $500. |
| National Marketing Fee | Currently 3% of gross sales; the franchisor has the right to increase the fee to 5% of gross sales upon 60 days’ notice. |
| Regional Marketing Fee | If established in a region where the unit is located, the franchisor will determine the amount of the fee, not to exceed 2% of gross sales. |
| Local Marketing Requirement | Minimum of 2% of gross sales. |
| Grand Opening Advertising | $15,000 for all new traditional unit locations. $7,500 for all new non-traditional unit locations. |
| Interest on Late Payments | 18% per annum or maximum rate allowed by law, if less than 18%. Plus $50 late fee payment. |
| Training Fees | No charge for initial training programs for the first two trainees. Reasonable fee may be charged for additional trainees to attend. |
| Remodel Costs | 5 Years: Up to $25,000 for materials. |
| Audit Fees | Audit discrepancies and reasonable actual costs of conducting audit. |
| Transfer Fees (Franchise Agreement) | $7,500 - $12,500 plus $5,000 for grand opening advertising. |
| Transfer Fees (Area Development Agreement) | 10% to 20% of then-current initial franchise fee. |
| Securities Offering Fee | Not to exceed $25,000. |
| Supplier Approval Fee | Actual costs of inspection and testing. |
| Legal Fees and Costs | Reasonable expenses associated with enforcement of agreements. |
| Design Documents for New and Relocated Stores | Up to $2,500 (non-refundable). |
| NSF Checks or Draft | $50 for first occurrence; $75 for each occurrence thereafter. |
| Product and Service Purchases | Varies. |
| Extra Operational and Marketing Support, Including Visits to Cure Operational Issues | Reimbursement of reasonable actual expenses. |
| Technology Fee | Reasonable monthly fee; currently $200 per month. |
| Software and Security Fee | Currently, $225 to $265 per month. |
| Relocation Fee | Up to $2,500 (site package and plans may be an additional charge). |
| Renewal Fee | Currently, 1/2 of the current initial franchise fee; and $775 renewal upgrade design fee (non-refundable). |
| Failure to Submit Monthly Profit and Loss Statements | $500 per month. |
| Failure to Operate Minimum Hours and Days | $200 per day. |
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