In this FDD Talk post, you’ll learn the following:

• Section I – Background information on The Brass Tap franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for The Brass Tap franchise, based on Item 7 of the company’s 2017 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for The Brass Tap franchise, based on Items 5 and 6 of the company’s 2017 FDD

• Section IV – Presentation and analysis of The Brass Tap’s financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:

• 2016, 2015, and 2014 average and median adjusted gross sales for all company-owned and franchised Brass Tap Bars that were open and operating for at least 12 months before December 31 of each year for which data are shown (“Reporting Brass Tap Bars”)

• 2016, 2015, and 2014 average and median adjusted gross sales for all Reporting Brass Tap Bars that have a full liquor license and a full kitchen (“Reporting 2.0 Brass Tap Bars”)

• 2016, 2015, and 2014 average and median adjusted gross sales for the top quartile Reporting 2.0 Brass Tap Bars

• 2016, 2015, and 2014 average and median adjusted gross sales for the bottom quartile Reporting 2.0 Brass Tap Bars

Section I – Background Information

11 Things You Need to Know About The Brass Tap Franchise

Targeting Multi-Unit Operators

1.  In July 2017, The Brass Tap announced its plans for nationwide growth by targeting multi-unit operators. At the time of the announcement, The Brass Tap said its goal was to have over 50 locations open by the end of 2017. The brand determined that honing in on multi-unit operators to promote growth in new markets was the fastest and least expensive option to reach its goal.

2.  To attract more multi-unit franchisees, The Brass Tap is offering reduced franchise fees to those who enter into an Area Development Agreement ($37,500 for the first location, $25,000 for the second location, $15,000 for the third location, $5,000 for the fourth location, no fee for the fifth and subsequent locations). The Brass Tap currently has five Area Development Agreements and aims to increase that number to well over 20 within the next three to five years.

3.  Jean Baudrand, The Brass Tap’s chief development officer, said, “At a time where many guests look for more than food, our concept has matured to offer unique cocktails and craft beer pairings with an entertaining social atmosphere. We’re looking for candidates to join our growing franchise to support this vision, and look forward to the bright future ahead as we enter new markets nationwide.”

Joins Stella Artois and Water.org in Fight for Clean Water

4.  At the end of February 2018, The Brass Tap announced that it had joined Belgian beer brand Stella Artois and Water.org to help promote the charitable foundation’s mission of providing safe water to homes without access around the world.

5.  One of Water.org’s flagship efforts since its partnership with Stella Artois began in 2015 is The Buy A Lady A Drink campaign. It was created to leverage Stella’s international marketing and distribution network to provide relief for people in developing countries who lack access to safe water, a crisis that disproportionately affects women. In 2017, Stella Artois said that it would be extending the campaign for another four years.

6.  In early 2018, The Brass Tap pledged its support for the campaign, offering a three-month marketing and promotion campaign to raise money for the cause. During the three-month promotion, Stella Artois will donate one month’s worth of safe water to people in need for every pint of beer The Brass Tap sells. The Brass Tap will be promoting Stella with happy-hour specials, including $4 pints of the beer, and limited-edition glassware that customers who purchase Stella can take home. To help sell as much Stella as possible, The Brass Tap will advertise the promotion on its website and all of its social media platforms for the duration of the promotion.

Unit Growth Helped by Craft Industry Boom

7.  The Brass Tap credits the craft beer industry boom for its recent success. The Brass Tap opened 12 new locations in the first three quarters of 2017, and at the time of a press release, the brand said it had six more units in development. The new locations grew the system by 20 percent year-over-year and The Brass Tap was close to reaching the 50-location milestone.

8.  According to Jean Baudrand, The Brass Tap’s chief development officer, The Brass Tap stands out
because of the wide variety of entertainment that its taprooms offer. Each location offers a variety of sports on high definition TVs, hosts trivia nights along with Tap Takeovers and Kill the Keg nights, and proves its loyalty to the community by asking local musicians to entertain for the evening.

Company History

9.  The Brass Tap was founded in 2008 by Jeff Martin, Gary Bailey, and Steve Slowey in Wesley Chapel, Florida. A year before opening the first location, the three friends and business partners decided to create the “Ultimate Beer Bar.” They recognized the explosive growth of the craft beer market and appreciated the simplicity of operating a beer bar verses a full-service restaurant. A second restaurant opened in 2010 in Brandon, Florida.

10.  In 2012, The Brass Tap was acquired by Beef ‘O’ Brady’s, a Florida-based chain of family sports pubs. Both brands are franchised by FSC Franchise Co., LLC. In August 2017, CapitalSpring acquired a majority stake in FSC Franchising Co., LLC. Today, there are over 50 The Brass Tap locations across the United States.

Entrepreneur’s Franchise 500

11.  The Brass Tap debuted on Entrepreneur’s annual Franchise 500 list in 2018 at No. 213. The brand previously appeared on Entrepreneur’s 2017 Best Franchises for Any Budget list at No. 37.

Section II – Estimated Costs

• Please click here for detailed estimates of The Brass Tap franchise costs, based on Item 7 of the company’s 2017 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on The Brass Tap’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.

Section IV – Financial Performance Representations (Item 19, 2017 FDD) and Analysis

• The tables below contain the historical average Adjusted Gross Sales for company-owned and franchised Brass Tap Bars.

• Table 1 below provides the average Adjusted Gross Sales for all company-owned and franchised Brass Tap Bars that were open and operating for at least 12 months before December 31 of each year for which data are shown on the charts below (“Reporting Brass Tap Bars”).

• Table 2 below provides average Adjusted Gross Sales for only those Reporting Brass Tap Bars that have a full liquor license and a full kitchen (“Reporting 2.0 Brass Tap Bars”).

• Tables 3 and 4 below provide average Adjusted Gross Sales information for Reporting 2.0 Brass Tap Bars, broken down by those Reporting 2.0 Brass Tap Bars that achieved an average Adjusted Gross Sales that ranked in the top quartile (“Top Quartile Reporting 2.0 Bars”) of all Reporting 2.0 Brass Tap Bars, for each of the three previous fiscal years, respectively, and those Reporting 2.0 Brass Tap Bars that achieved an average Adjusted Gross Sales that ranked in the bottom quartile (“Bottom Quartile Reporting 2.0 Bars”) of all Reporting 2.0 Brass Tap Bars for each of the previous three fiscal years, respectively.

Part 1 – Average Adjusted Gross Sales for All Reporting Brass Tap Bars

• Although there were a total of 38, 32, and 19 Brass Tap Bars operating domestically as of December 31, 2016, 2015, and 2014, respectively, there were 32, 19, and 9 Reporting Brass Tap Bars in 2016, 2015, and 2014, respectively.

2016