Updated April 20, 2021.
Detailed Estimates of Great Harvest Bakery Cafe Franchise Costs Based on Item 7 (Estimated Initial Investment) of Great Harvest Bakery Cafe’s 2021 Franchise Disclosure Document
For Single-Site or Hub Locations
- The estimated initial investment level for a new franchisee (including existing franchisees acquiring additional Great Harvest Bakery Cafe locations) based on the actual low and high costs for the various line-item expenses in the table below incurred by 18 first-time franchisees who opened their first Great Harvest Store operating as a bakery cafe between January 2015 and December 2020 (and who reported this information to Great Harvest out of 22 first-time franchisees), ranges from $141,884 to $919,179 (assuming the currently-charged $35,000 initial franchise fee and currently-mandated $12,000 grand opening marketing spend).
- However, the actual total investment level of those 18 first-time franchisees for their 18 Great Harvest Stores operating as a bakery cafe ranged from a low of $202,426 to a high of $738,388, with an average of $422,919.
1. Initial Franchise Fee: $35,000
2. Expenses While Training: $1,936 to $26,031
3. One Month’s Rent: $3,130 to $10,800
- Most Great Harvest franchisees lease their space. The initial monthly lease cost ranged from $3,130 to $10,800 for first-time franchisees who opened between January 2015 and December 2020, depending on the square footage costs in the community.
- A bakery cafe’s premises typically is in a strip center or stand-alone location in a commercial area or downtown area when that area is viable for every-day retail.
- Lease and leasehold improvement costs depend on the condition, location, and size of the premises; the demand for the premises among possible lessees; whether the premises were used for similar operations; the build-out required; and any construction or other allowances the landlord gives you.
- Your lease costs are an important consideration. You are responsible for this cost for the entire lease term regardless of your Bakery Cafe’s performance and, more often than not, will have personal liability for the lease costs even if you have an entity to own and operate your Bakery Cafe.
4. Real Estate and Improvements: $2,156 to $504,236
5. Equipment: $60,050 to $209,881
- Costs vary because necessary equipment is based on estimated sales at the location (determined after the Franchise Agreement is signed). The availability of used equipment also is a factor.
- One item not readily reflected in the range is the cost of having a mill meet certain manufacturing standards that historically have not applied to that piece of equipment. While Great Harvest is aware of only 2 Great Harvest Stores in its system ever having to satisfy that requirement, it might be required in the future.
- If you must buy a mill meeting this different manufacturing standard, Great Harvest estimates the incremental cost to be between $5,000 and $20,000 depending on the age and size of the “old” mill to which you are comparing it.
6. Signs: $1,797 to $20,371
7. Prepaid Expenses and Deposits: $1,481 to $18,220
- Prepaid expenses and deposits include security deposits, utility deposits, permit costs, insurance premiums, and similar items. Some of these items might be refundable.
8. Opening Inventory (Ingredients and Supplies): $3,654 to $34,275
- You must spend at least $12,000 on a grand opening advertising program beginning before, and extending 4 months after, your Bakery Cafe opens.
9. Grand Opening Advertising Costs: $12,000
10. Organizational Costs/Miscellaneous: $680 to $28,365
- Organizational costs include legal and accounting fees, incorporation costs, and other miscellaneous expenses incurred before opening.
11. Additional Funds – 3 Months: $20,000
- This item estimates your initial start-up expenses (other than the items identified separately in the table). These expenses include payroll costs but not any draw or salary for you.
- These figures are estimates, and you might need additional working capital during the first 3 months you operate your Bakery Cafe and for a longer time period afterward.
- This 3-month period is not intended, and should not be interpreted, to identify a point at which your Bakery Cafe will break even.
- Your costs will depend on how much you follow Great Harvest’s methods and procedures; your management skill, experience, and business acumen; local economic conditions; the local market for your products and services; the prevailing wage rate; competition; and the sales level reached during the initial period.
- Great Harvest relied on its decades-long experience granting franchises for Great Harvest Stores to compile this Additional Funds estimate.
12. Total Estimated Start-Up Costs: $141,884 to $919,179
For Spoke Locations
- Total Estimated Start-Up Costs: $60,000 to $447,536 (with an average of $178,706)