Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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FDD Talk Daily: Annual Gross Sales of Franchised and Affiliate-Owned Popcornopolis Stores

by Franchise Chatter on December 21, 2012

in Franchise Earnings, Popcorn Franchise



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Highlights of Popcornopolis’ Item 19 Financial Performance Representations (2012 FDD)

  • The franchisor grants franchises for retail establishments that serve gourmet popcorn, chocolate, and related snacks.
  • The total investment necessary to begin operation of a Popcornopolis franchise ranges from $198,000 to $395,000, including $37,600 to $40,000 that must be paid to the franchisor.
  • If you sign a Development Agreement, you will also pay a development fee equal to $15,000 for each Store to be developed. The portion of the development fee allocatable to each Store (which is $15,000 for each Store) will be credited against the initial franchise fee due for that Store.

Full Year Popcornopolis Total Store Income (January 1 through December 31, 2011)

  • The following section shows the total Gross Sales for all Popcornopolis Stores open during the entire 2011 fiscal year and the average Gross Sales of these stores.
  • Stores 01 and 02 are owned and operated by the franchisor’s affiliate, Pop LLC.
  • Popcornopolis Photo by Harvey-HarvStores 03, 05, and 07 were originally established and operated by Pop LLC but, in 2009, Stores 03 and 05 were sold to franchisees, and, in 2010, Store 07 was sold to a franchisee.
  • In 2010, Store 03 was repurchased from a franchisee by Pop LLC, and it was resold in 2011 to another franchisee.
  • Popcornopolis Stores 01 and 02 described below were open at least 5 years; Stores 03, 05, 06, and 07 were open for between 2 and 5 years; and the remaining stores were open less than 2 years.
  • 8 of the 11 locations are in-line in malls while one is in the Universal Studios Amusement Park in a refitted Airstream trailer (Store 02), one is in-line in the Universal City Walk retail center (Store 01), and one is located in the Excalibur Casino in Las Vegas, NV (Store 09).
  • In addition to the Popcornopolis Stores described above, Pop LLC operates an online business and wholesale business. The financial results of those other alternate distribution channels are excluded from the income figures reported below.
  • Store 01 – Citywalk:  $1,076,522
  • Store 02 – Airstream:  $772,174
  • Store 03 – Valencia:  $371,743
  • Store 04 – No information provided.
  • Store 05 – Mainplace:  $471,095
  • Store 06 – Roseville:  $421,846
  • Store 07 – Culver City:  $469,162
  • Store 08 – Del Amo:  $489,227
  • Store 09 – Excalibur:  $375,580
  • Store 10 – Chandler:  $417,057
  • Store 11 – Indianapolis:  $455,200
  • Store 12 – Austin:  $406,267
  • Average:  $520,534
  • Of the stores described above, 2 stores (or 18%) exceeded the average Gross Sales.

The Bottom Line

  • Popcornopolis’ average annual gross sales in 2011 ($520,534, based on 11 units) is significantly higher than that of its closest competitor in the popcorn franchise category, Doc Popcorn.  The 2011 average annual gross sales for a Doc Popcorn PopShop unit was $388,899.90 (1 unit), while the average for a Doc Popcorn PopKiosk was $251,829 (9 units).  The average for a Doc Popcorn Mobile Poperating Unit was $82,175 (4 units).
  • But Popcornoplis’ average is skewed higher because of the stellar locations of two affiliate owned-stores, one in the Universal City Walk retail center and the other in the Universal Studios Amusement Park. Both of these stores are in major tourist attractions with a captive market, and both had been open for at least 5 years (all other Popcornopolis stores had been open for less than 5 years). If we were to exclude the sales of these 2 “outliers”, we arrive at an average gross sales of $430,797.44, which is still higher than Doc Popcorn’s, but to a lesser degree.
  • Popcornopolis is best known for their sweet popcorn flavors (like Cinnamon Toast, Cupcake, and Pecan Caramel), although they offer savory flavors as well (such as Cheddar Cheese and Sour Cream and Onion), which you can mix and match to create a sweet-salty combination. Each flavor is sold in small, beautifully presented plastic cones, and you can combine multiple flavors in tin cans or gift baskets.
  • While Doc Popcorn also offers a few sweet flavors (Caramel Kettle and Sinfully Cinnamon), they specialize in flavors that you would normally find in movie theaters and other concession stands (Cheesy Cheddar and Sweet Butter). The main difference I see between the two concepts is that Popcornopolis has a gift business in addition to a snack business, while Doc Popcorn is primarily a snack business.
  • Popcorn tends to have high margins, so Popcornopolis Stores are probably earning a good profit given their current level of sales.

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