In this FDD Talk 2017 post, you’ll learn the following:
- Section I – Background information on the Mrs. Fields franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Mrs. Fields franchise, based on Item 7 of the company’s 2017 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Mrs. Fields franchise, based on Items 5 and 6 of the company’s 2017 FDD
- Section IV – Presentation and analysis of Mrs. Fields’ financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:
- 2016 average gross revenue, royalty expense, and marketing expense for the 114 franchised Mrs. Fields Stores (excluding non-traditional, licensed, and corporate Stores) that were open and operating in 2016 (each, a “Representative Franchised Store”)
- 2016 average cost of goods sold and income before variable cost for the 8 franchised Mrs. Fields Stores (excluding non-traditional, licensed, and corporate Stores) that were open and operating in 2016 and systematically report COGS information to Mrs. Fields
Section I – Background Information
12 Things You Need to Know About the Mrs. Fields Franchise
Legal Battle with Interbake Foods LLC
1. In late 2016, Mrs. Fields entered into a legal battle with Interbake Foods LLC, the company that makes Girl Scout cookies and store-brand treats for retailers such as Walmart. Mrs. Fields filed suit against Interbake and is seeking $28 million in damages.
2. The company claims that Interbake pulled out of a five year deal, which was set to end in December 2017, to oversee the retail sales of Mrs. Fields’ cookies and brownies. The deal was struck after Mrs. Fields turned down Interbake’s offer to buy the company’s branded retail and gifting business for $50 million.
3. In the court filings, Mrs. Fields accused Interbake of trying to “wrongfully dismantle and cannibalize the business once it could not purchase it.” Mrs. Fields also accused Interbake of trying to steal its customers and recipes. In response, Interbake claims that it backed out of the deal because of misleading sales figures from Mrs. Fields.
4. The initial deal required Interbake to reach certain targets for retail sales of Mrs. Fields cookies. Mrs. Fields says that Interbake failed to reach those targets and did not properly promote the brand. Interbake says that it did hit its target with sales of $23 million in 2013, $17 million in 2014, and $18 million in 2015. Interbake says that Mrs. Fields lied about how many cookies the company could expect to sell.
5. Court proceedings began in November and are still ongoing. Delaware Chancery Court Judge Andre Bouchard ordered Interbake to keep selling Mrs. Fields cookies until he rules.
Third CEO in Three Years
6. In late September 2016, Dustin Lyman was appointed as the new CEO of Famous Brands International, the parent company of Mrs. Fields. Lyman had previously served as the company’s Chief Financial Officer.
7. Lyman’s appointment marks the company’s third CEO in three years. Lyman replaces Johnathan Drake, who was appointed CEO in 2015. Drake stepped in for Neal Courtney, who was named CEO in 2013.
Looking for New Ways to Attract Attention
8. A month after Dustin Lyman stepped in as CEO, Lyman announced that Famous Brands would be retooling both Mrs. Fields and TCBY to help Famous Brands International, which has been on the market for more than a year with no interested buyers, attract attention.
9. According to Lyman, mall traffic has been down, so Mrs. Fields is looking to expand beyond the traditional retail mall setting to reach more customers. Mrs. Fields is also working to offer shelf-stable cookies and refrigerated cookie dough in grocery stores. Famous Brands is also experimenting with opening co-branded Mrs. Fields/TCBY locations and has already opened one co-branded location in a Colorado Walmart as a test.
10. The first Mrs. Fields store was opened in 1977 by Debbi Fields and her husband Randy in Palo Alto, California. In 1982, the company moved its headquarters to Utah. A decade later, the company was sold to an investment firm and franchising began around this time.
11. Today Mrs. Fields is owned by Famous Brands International which also owns TCBY. There are currently over 300 Mrs. Fields locations around the world.
Entrepreneur’s Franchise 500
12. Mrs. Fields is franchised under TCBY and Mrs. Fields. The company has only appeared once in the last decade on Entrepreneur’s annual Franchise 500 list at No. 456 in 2015.
Section II – Estimated Costs
- Please click here for detailed estimates of Mrs. Fields franchise costs, based on Item 7 of the company’s 2017 FDD (updated).
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on Mrs. Fields’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.