The decision to get into the coffee business is a smart one given that the average person in the U.S. spends more than $20 every week on coffee for a total annual coffee-related spend of $74 billion. Coffee is the second most popular beverage in the U.S., outranked only by water.
What’s interesting, however, is that the number of people who drink regular “drip” coffee has fallen to only about half of all coffee drinkers. What has grown in popularity are gourmet and specialty coffees. It is the younger coffee drinkers driving the shift towards espresso-based coffee drinks.
The variety of specialty coffee franchises has grown to meet this demand, ranging from such venerable giants as Dunkin’ Donuts and Tim Hortons to many new entrants offering a diverse range of concepts and models. And most coffee shops now offer a wider menu of both beverages and food items to go along with whatever specific ambience they have cultivated to appeal to consumers.
Entrepreneurs looking to break into the coffee industry have a diverse range of offerings to choose from. Here are our picks for the top 25 coffee franchises of 2017/2018:
1. Dunkin’ Donuts
Dunkin’ Donuts is the undisputed champion of coffee franchises with its 12,287 locations, none of which are company-owned, 8,884 of which are U.S. franchises, and 3,403 of which are franchised locations outside the U.S. (Starbucks has vastly more locations at 26,700, but doesn’t franchise in the U.S.).
Dunkin’ Donuts dates back to 1948 when William Rosenberg opened a coffee and donut shop called Open Kettle, then changed the name to Dunkin’ Donuts in 1950 and started franchising in 1955. America Runs on Dunkin’ is the well-known catch-phrase that the chain has used since 2006. The chain’s parent company, Dunkin’ Brands, also owns the Baskin-Robbins chain of ice cream shops.
2. Tim Hortons
Tim Hortons is Canada’s largest quick-service restaurant chain known mostly for its coffee and donuts, but also serves breakfast and lunch sandwiches, wraps, and soups, as well as baked goods and ice cream supplied by Cold Stone Creamery. The chain was started by Canadian hockey legend Tim Horton in 1964. After Horton died in a car accident in 1974, investing partner Ron Joyce took over the company and expanded. From 1995-2006 the chain was merged with Wendy’s and then spun off and became a public company until it was merged with Burger King in 2014, which in turn is controlled by Brazilian investment firm 3G Capital.
At the end of 2016, there were 4,613 locations in 9 countries.
3. The Coffee Bean and Tea Leaf
The Coffee Bean and Tea Leaf got its start in the Brentwood neighborhood of Los Angeles, California in 1963, when founder Herb Hyman started importing and roasting his own coffee. The company puts a lot of effort into sourcing its coffee and tea in socially conscious ways, building direct relationships with farmers and growers. Its motto of “impacting lives from seed to cup” includes the company’s Caring Cup initiative that supports local school children in the U.S., company employee development, and improving the communities and lives of the people who grow the coffee and tea.
There are now more than 1,100 locations in the U.S. and 29 other countries.
4. Biggby Coffee
Biggby Coffee got its start back in 1995 when Bob Fish and Mary Roszel converted an old Arby’s restaurant into a coffee shop called Beaner’s in East Lansing, Michigan. They started franchising in 1999, opening locations throughout Michigan. Unaware that “beaner” is a word some use to derogatorily refer to Mexicans, in 2007 they changed the name to Biggby since the company logo is a “big B” and it sounded fun.
The chain has grown rapidly over the last ten years, increasing the number of locations from 85 in 2007 to its current 230 locations, all of which are franchised in the U.S.
5. Dunn Brothers Coffee
Dunn Brothers Coffee was started by two brothers, Ed and Dan Dunn. They learned about coffee roasting when they lived in Portland, Oregon. They moved to the Twin Cities area and opened Dunn Brothers Coffee in 1987. The chain is committed to daily small-batch, in-store roasting of coffee beans to achieve a richer, fresher quality. This can only be performed by roasters who have completed the Dunn Brothers Coffee Certified Roaster Program.
Franchising began in the late 1990s and the number of locations has declined slightly in recent years from 96 in 2007 to the chain’s current 82 locations.
6. PJ’s Coffee of New Orleans
PJ’s Coffee of New Orleans dates back to 1978 when Phyllis Jordan (PJ) opened a coffee shop in the Carrollton neighborhood of New Orleans. She expanded with additional company-owned locations around New Orleans and then started franchising the concept in 1989 to expand throughout the Southeast and around the nation. She sold the company in 2002 to Atlanta-based Raving Brands, but the franchise subsequently returned to New Orleans in 2008 when it was purchased by New Orleans Brew. PJ’s has positioned itself as a competitor to Starbucks and has a similar menu.
There are currently 77 locations, all franchised in the U.S., mostly in Louisiana but with a handful of locations in Mississippi, Texas, South Carolina, Massachusetts, Arkansas, and Florida.
7. Gloria Jean’s Coffee
Gloria Jean’s Coffee dates back to 1979 when Gloria Jean Kvetko opened the first location in Chicago, Illinois. The chain found initial success by focusing on mall-based locations. The menu features a wide array of both hot and cold gourmet coffee beverages. Gloria Jean’s also sells a selection of its ground coffees through a subscription service, with an emphasis on flavored coffees. In 2014, the chain was purchased by Australian company Retail Food Group.
The company website currently lists 57 locations in the U.S., but there are well over 800 more in countries around the world, including hundreds in Australia.
8. Scooters Coffee
Scooters Coffee was founded by Don and Linda Eckles with their first drive-thru coffeehouse in Bellevue, Nebraska, naming it after their daughter, whose nickname was Scooter. The chain is committed to high-quality coffee drinks and customer-focused speedy service as captured in the company motto: Amazing People, Amazing Drinks… Amazingly Fast! Every coffee drink can be had hot, iced, or blended, and the menu also includes tea and smoothies along with a selection of pastries, sandwiches, and burritos.
Franchising began in 2001 and the chain has expanded steadily over the past 10 years from 59 locations in 2007 to its current 167 locations, with 150 in the works.
9. Maui Wowi
Maui Wowi is a chain of Hawaiin coffee and smoothie shops that dates back to 1982 when Jeff and Jill Summerhays opened the first location to offer up a healthier alternative to sugar-heavy, fat-laden products offered by others. It also emphasizes a laid-back, “flip-flop attitude” while at the same time emphasizing “Ohana” or a family-like community among franchisees. Their smoothies feature proprietary non-fat yogurt recipes, exotic fruit juices, fruit purees, and all-natural flavorings.
The company started franchising in 1997 and there are now 450 franchise operations in 48 states, two in Saudi Arabia, and one in the United Arab Emirates.
10. Caffé Bene
Caffé Bene, known as the largest chain of coffee shops in South Korea, was founded in 2008 by Sun-Kwon Kim. The concept presents a European-style coffeehouse along with coffee, tea, smoothies, bagels, and desserts. The first location outside South Korea was established in New York City in 2012.
The chain has expanded all around the world and now has more than 1,300 locations in South Korea, Japan, Taiwan, Vietnam, the Philippines, Saudi Araba, Indonesia, Malaysia, Mongolia, Cambodia, and the United States. The number of locations has fluctuated in recent years as the company expanded very rapidly and then contracted slightly.
11. The Human Bean
The Human Bean is a drive-thru espresso shop that got its start back in 1998 with the first location in Ashland, Oregon. Franchising began in 2002 and there are now 70 locations, mostly in Western states. The chain has its own coffee sourcing program, Farm Friendly Direct, that builds long-term relationships with coffee farmers, encouraging them to grow their coffee sustainably, paying them above-market prices to allow for investing in their communities by funding local infrastructure improvement projects.
The company does not charge franchisees any ongoing percentage-of-sales royalty or marketing fees, earning its revenues instead from the sale of coffee and supplies to franchisees.
12. Aroma Joe’s Coffee
Aroma Joe’s Coffee is a drive-thru coffee chain founded by two sets of brothers who were born and raised in Berwick, Maine: Marty and Tim McKenna and their cousins Brian and Mike Sillon. They opened their first location back in 2000, when it was just a kiosk in a New Hampshire parking lot. Their three laws of service are: No intercoms. No mistakes. No attitudes. It caters to a relatively young demographic with its hot and cold coffee drinks and its own branded Rush energy drink.
Headquartered in Portland, Maine, there are currently just over 50 locations, all in New England, except for one location near Pittsburgh, Pennsylvania.
13. Coffee Beanery
Coffee Beanery dates back to 1976 when husband and wife team JoAnne and Julius Shaw opened the first location in Dearborn, Michigan to sell “specialty coffees,” which was something new to most Americans in those days. In addition to coffee and tea, the menu features smoothies and other beverages along with an array of breakfast sandwiches, toasted signature sandwiches, paninis, and specialty wraps.
Legal troubles with franchisees has caused the number of locations to steadily decline over the last 10 years from 147 in 2007 to its current 70 locations.
14. DRNK coffee + tea
DRNK coffee + tea was founded by Thomas Nariman, who had previous experience opening and operating franchises such as Johnny Rockets and Pinkberry. Based on his experiences with other chains, he decided to create his own concept in 2013. The fledgling chain presents a wide selection of both hot and cold organic coffees and teas, handcrafted organic espresso drinks, and juices, along with a variety of fresh-made breakfast items, paninis, wraps, and salads. It has a greater focus on quality teas than most coffee shops, and focuses on organic and ethically-sourced products.
There are currently 9 locations, all in California, with another 6 slated to open soon, including 4 more in California, one in Virginia, and one in Saudi Arabia.
15. Sweetwaters Coffee and Tea
Sweetwaters Coffee and Tea got its start back in 1993 when husband and wife team Wei and Lisa Bee opened the first location in Ann Arbor, Michigan. The concept presents a classic café experience of coffee and tea drinks with diverse global influences. The chain also offers a selection of frozen drinks and other beverages, pastries, desserts, and light fare such as quiche, sandwiches, salads, and yogurt parfaits. Sweetwaters also retails its own coffee blends and bottled teas.
There are currently nine locations, with six in Michigan, two in Ohio, and one in California.
16. Ziggi’s Coffee
Ziggi’s Coffee was started by husband and wife team Brandon and Camrin Knudsen in 2004 as a small coffee shop in downtown Longmont, Colorado. The chain emphasizes sourcing its coffee and food ingredients from local vendors whenever possible. The menu features coffee, coffee alternatives, frozen “blenderz,” fruit smoothies, and a small selection of food items. Store formats include double drive-thrus, café with drive-thru, and just a café, although the primary emphasis has always been on the double drive-thru model.
There are currently nine drive-thru and coffeehouse locations across Colorado, with more locations on the way in Colorado and Arizona.
17. Café Barbera
Café Barbera – The Italian Coffee House is a company that goes all the way back to 1870 when founder Domenico Barbera opened his first coffee shop in southern Italy. Today, 147 years later, it is still a family-owned company that serves premium authentic Italian coffee still sourced from seven varieties of the world’s finest coffee beans, slow roasted separately, and then blended into the company’s original recipe. In addition to hand-brewed coffee drinks, the menu features Italian-inspired panini sandwiches, Mediterranean-style salads, and light croissant breakfasts.
Franchising began in 2004 and there are currently 40 locations in 17 countries, including just one in the U.S. in Tampa, Florida.
18. Cafe2U
Cafe2U is an Australian-based mobile coffee shop concept that requires a much lower up-front investment from franchisees than traditional coffee shop concepts. Vans equipped with coffee-making equipment allow franchisees to serve up all manner of coffee drinks anywhere and everywhere. The first prototype of its espresso and coffee van was launched in Sydney, Australia back in 2000.
The company now operates franchises in Australia, New Zealand, South Africa, the United Kingdom, and the United States. The U.S. market is new, with only five locations, while there are 236 locations spread throughout the other countries mentioned.
19. Classic Rock Coffee
Classic Rock Coffee brings a concept similar to Hard Rock Café to the world of coffee. The menu features coffee, frappes, smoothies, protein shakes, pastries, sandwiches, flatbreads, salads, and more with classic rock always playing in an upbeat ambience. The first location was established in 2011 in Springfield, Missouri, where the company is headquartered.
There are currently 11 locations open, with five in the U.S., two in India, and one each in Pakistan, Nigeria, Bangladesh, and Qatar. Another 10 are set to open soon in the U.S. and another four abroad in Jordan, Dubai, Romania, and Nepal.
20. Rock ‘n’ Joe Coffee Bar
Rock ‘n’ Joe Coffee Bar is a chain featuring specialty coffees from Dillanos Coffee Roasters, sandwiches, wraps, salads, and pastries combined with rock music and memorabilia in a laid-back setting that feels like an exclusive backstage lounge. Its artisan coffees include such creatively-named options as Velvet Underground, Sledgehammer, Unplugged, and Black Dog.
The first location was established in New Jersey back in 1993. There are now four in New Jersey and one in Pittsburgh, Pennsylvania with a second Pittsburgh location slated to open soon. In 2013, the chain was purchased by Ablak Holdings with plans to take it nationwide.
21. Bottom’s Up Espresso
Bottom’s Up Espresso came up with a unique concept in 2011 when it opened its first location in Modesto, California: Unique coffee beverages served up by sexy baristas in bikinis. Think of it as the Hooters concept applied to coffee, with a slightly different anatomical focus. The menu features an array of classic coffee drinks, smoothies to which customers can add soy or whey protein, and “Twisted Energy” fruit-juice drinks to which customers can add an energy shot. The company also markets a large selection of company merchandise that includes apparel, drinkware, outerwear, hats, and accessories.
There are now six locations, all in central California.
22. Xpresso Delight
Xpresso Delight is taking a unique approach to franchising in the coffee industry by bringing a café-quality coffee experience into workplaces with its range of fully-automated gourmet espresso coffee systems. The equipment is manufactured in both Switzerland and Italy, is easy to use, and produces high-quality cappuccinos, lattes, and espresso drinks in just 30 seconds.
Headquartered in Australia, the company was co-founded by Paul Crabtree and Stephen Sptiz and has become a fast-growing franchise throughout Australia and New Zealand with more than 150 franchisees. The company is now looking to open up other international markets.
23. Euro Café
Euro Café was started in 1997 in Virginia and can be found within 15 Hudson News and Hudson Bookseller locations inside airports in the U.S. and Canada. There are also two standalone Euro Markets that include Euro Cafés, as well as locations on five campuses of the Northern Virginia Community College system.
The menu features a range of both hot and cold coffee and coffee alternative beverages, frozen drinks, fruit smoothies, breakfast sandwiches, salads, wraps, hot and cold sandwiches, hot paninis, burgers, soups, rice bowls, kabobs, and other food items.
24. Hard Bean Coffee
Hard Bean Coffee is different from the typical franchise model. Founder and CEO Scott Bortz had opened several different coffee stands, including one he called Hard Bean Café after the type of coffee beans roasters call “hard” – more flavorful and typically grown at higher altitudes.
His program is one that helps people plan, build, and open their own independent coffee shop for a flat fee without ongoing royalty payments. Owners can give their shops whatever name they like along with the tagline powered by Hard Bean Coffee. The company also has The Buying Co-Op that allows coffee shop owners to leverage their collective buying power to purchase coffee and coffee-making equipment.
25. The American House
The American House is a new coffee and tea chain focused on organic and natural products that has as much focus on retailing its tea, coffee, herbs, and spice products in bulk as serving up prepared drinks to customers. Store ambience is a throwback to simpler times with a historic feel to its décor. It positions itself as an alternative to the “overly-commercialized” coffee shops of other chains and caters to the growing segment of consumers looking for more natural and healthy products.
The first location has been established in San Diego, California, and the company’s franchising program is now underway.
An Important Note About Our Methodology
The franchises on this list were ranked according to the number of units in the franchise system. If you are a prospective franchisee searching for franchise opportunities that meet or exceed certain performance benchmarks for sales, profits, and return on investment, please check out this list of America’s Most Lucrative Franchises.
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