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

• Section I – Estimated initial investment (franchise costs) for an Ellianos Coffee franchise, based on Item 7 of the company’s 2022 FDD

• Section II – Initial franchise fee, royalty fee, and marketing fee for an Ellianos Coffee franchise, based on Items 5 and 6 of the company’s 2022 FDD

• Section III – Number of franchised and company-owned Ellianos Coffee outlets at the start of the year and the end of the year for 2019, 2020, and 2021, based on Item 20 of the company’s 2022 FDD

• Section IV – Background information on the Ellianos Coffee franchise opportunity, including relevant news updates

• Section V – Presentation and analysis of Ellianos Coffee’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2022 FDD, including information on the:

• 2021 fiscal year average gross sales and discounts; average, median, high, and low net sales; and average transactions for the top quartile, second quartile, third quartile, bottom quartile, and all 16 franchised Ellianos Coffee stores (including 4 stores operated by Ellianos’ officers) that were open the entire fiscal year

• 2020 fiscal year average, median, high, and low net sales for the top quartile, second quartile, third quartile, bottom quartile, and all franchised Ellianos Coffee stores (including 3 stores operated by Ellianos’ officers) that were open the entire fiscal year

• 2020 and 2021 average total income (net sales), cost of goods sold, gross profit, payroll expenses, royalties, other expenses (advertising, bank service charges, credit card fees, dues and subscriptions, insurance, licenses and permits, office supplies, professional fees, repairs and maintenance, supplies, uniforms, and utilities), total expenses, and net operating income for the Ellianos Coffee stores operated by Ellianos’ officers that were open the entire applicable fiscal year

• Section VI – Key ratios, comparables, computations, and analyses for the Ellianos Coffee franchise opportunity (exclusive content for Platinum subscribers)

Section I – Ellianos Coffee Franchise Costs

• Ellianos Coffee franchise costs, based on Item 7 of the company’s 2022 FDD:

• Initial Franchise Fee:  $25,000
• Initial Training Program – Travel and Living Expenses:  $1,000 to $3,000
• Real Estate:  variable
• Building/Improvements:  $218,000 to $350,000
• Site Work:  $50,000 to $150,000
• Equipment and Supplies:  $70,000 to $100,000
• Signs:  $14,000 to $25,000
• Opening Inventory:  $7,500 to $10,000
• Miscellaneous Opening Costs:  $2,000 to $6,000
• Grand Opening Spending (optional):  $0 to $1,000
• Additional Funds for 3 Months:  $10,000 to $20,000
• Estimated Total Ellianos Coffee Franchise Costs:  $397,500 to $690,000 (does not include real estate costs)

Section II – Ellianos Coffee’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Ellianos Coffee’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2022 FDD:

• Initial Franchise Fee:  $25,000
• Royalty Fee:  the greater of 5% of Net Sales or $250 per week
• Weekly Advertising Obligation (WAO):  1% of Net Sales; currently, Ellianos requires you to contribute the entire WAO to the Production Fund

Section III – Number of Franchised and Company-Owned Ellianos Coffee Outlets

Franchised

2019

• Outlets at the Start of the Year:  12
• Outlets at the End of the Year:  13
• Net Change:  +1

2020

• Outlets at the Start of the Year:  13
• Outlets at the End of the Year:  17
• Net Change:  +4

2021

• Outlets at the Start of the Year:  17
• Outlets at the End of the Year:  20
• Net Change:  +3

Company-Owned

2019

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2020

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2021

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

Section IV – Background Information on the Ellianos Coffee Franchise

17 Things You Need to Know About the Ellianos Coffee Franchise

Celebrates 20th Anniversary

1.  In late March 2022, Ellianos Coffee announced that it was celebrating the brand’s 20th anniversary. To commemorate the special anniversary, Ellianos hosted giveaways throughout the month of April and released a special anniversary drink.

2.  Founder Scott Stewart reflected with pride over the past 20 years, stating, “Ellianos Coffee didn’t happen overnight. It has resulted from an exciting dream, a lot of hard work, determination, and most importantly, a family of great people. Ellianos has always been much more than the stores or coffee – it’s always been about the people that make it all possible. From the hardworking baristas in our stores, amazing franchisees, and loyal customers, every face makes Ellianos what it is today. We couldn’t celebrate twenty years without saying ‘Thank you!’”

3.  To commemorate such a momentous anniversary, Ellianos released a special drink, The Cake Shake, available at Ellianos Coffee locations starting April 5th. The shake boasts notes of sweet vanilla swirled with cupcake flavoring and infused with rainbow sprinkles, available with or without coffee.

Offers Franchise Discount for Veterans

4.  In mid-July 2021, Ellianos Coffee partnered with VetFran to offer a franchise discount for U.S. veterans effective July 1, 2021. Ellianos Coffee extends a 20% franchise fee discount to all U.S. veterans who have a 25% or more ownership interest.

5.  The VetFran Program was founded in 1991 with the mission to link the entrepreneurial aptitude and skill of veterans with the incredible opportunity of being a franchisee by offering discounts and incentives to veterans, who are often drawn to the franchise business model because of their entrepreneurial spirit, motivation, and qualifications. These veterans emerge from service with strong leadership skills and the ability to motivate teams, improve systems, and work toward a clearly defined mission – all necessary qualities of a successful franchisee.

6.  Ellianos is proud to partner with VetFran to work toward the mission to bring Italian Quality at America’s Pace to communities across the Southeastern United States. Scott Stewart, founder of Ellianos Coffee, speaks about the new partnership, stating, “We are thrilled to be partnering with VetFran to make the franchising opportunity more of a reality to our veterans. We honor those who have served in our military and are grateful for the sacrifice they have made. It’s now our turn to serve them.”

Named a 2022 Top Franchise by Franchise Business Review

7.  In early February 2022, Ellianos Coffee was named a Top Franchise for 2022 by Franchise Business Review. This is the 17th annual ranking of the 200 best franchise opportunities as rated by franchise business owners.

8.  Ellianos Coffee is a double-sided drive-thru coffee franchise that was founded on the principles of quality, speed, and consistency. Founders Scott and Pam Stewart have dedicated their lives to this mission, developing systems and strategies to satisfy the consumer and franchisee alike.

9.  One such system is the proven, efficient double-sided drive-thru. This design provides consumers with speedy, convenient service while offering high-quality coffee and allows the franchisee to maximize sales. Ellianos Coffee is a rapidly growing brand with territory availability in states across the Southeast United States.

10.  Franchise Business Review, a market research firm that performs independent surveys of franchisee satisfaction and employee engagement, provides the only rankings and awards for franchise companies based solely on actual franchisee satisfaction and performance. Franchise Business Review publishes its rankings of the top 200 franchises in its annual Guide to Today’s Top Franchises.

11.  Ellianos Coffee was among over 300 franchise brands, representing more than 30,000 franchise owners, that participated in Franchise Business Review’s research. Ellianos’ franchisees were surveyed on 33 benchmark questions about their experience and satisfaction regarding critical areas of their franchise systems, including training and support, operations, franchisor/franchisee relations, and financial opportunity.

12.  Eric Stites, founder and CEO of Franchise Business Review, said, “While the pandemic impacted various business sectors differently, the last 18 months have clearly demonstrated the inherent strengths of the franchise business model. The old franchise adage of ‘being in business for yourself, but not by yourself’ has never been more important. Thanks to fast innovations, significant support, and responsive crisis management, many franchise brands have emerged stronger from the pandemic, and that is reflected in high franchisee satisfaction.”

13.  Mike Stewart, vice president of Ellianos Coffee, said, “We are truly honored by this recognition! It’s genuinely exciting to see years of brand building, prioritizing franchisee success, and our team’s dedication result in Ellianos Coffee being recognized as a Top 2022 Franchise!”

14.  “As an independent research firm, Franchise Business Review is committed to helping prospective franchisees get an objective view of the best franchise opportunities, based on actual feedback from franchise owners,” said Michelle Rowan, president and COO of Franchise Business Review. “We survey franchisees from franchise companies in the marketplace today and identify those with the highest levels of satisfaction and performance in order to educate potential buyers and help them choose which franchise to invest in. The companies on this year’s list of Top Franchises are the top-ranked brands in the key areas critical to their franchisees’ success.”

Company History

15.  Ellianos Coffee was founded in 2002 by Scott and Pam Stewart in Lake City, Florida. While vacationing in the Pacific Northwest, the Stewarts noticed how popular drive-thru specialty coffee shops were in the area. When they got home, the Stewarts saw an opportunity to open their own drive-thru specialty coffee shop because there weren’t any in Lake City. The Stewarts decided to open a double-sided drive-thru and only sell coffee made from high-quality ingredients.

16.  The specialty coffee drive-thru was a success and to keep up with demand, the Stewarts decided to start franchising in 2003. Scott Stewart already had experience with franchising as he owned a franchise in the pizza industry. Today, there are Ellianos Coffee locations in operation and opening across the Southeastern United States.

Entrepreneur’s Franchise 500

17.  Ellianos Coffee ranked No. 489 on Entrepreneur’s 2022 Franchise 500 list.

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Ellianos Coffee Franchise (Item 19, 2022 FDD)

Part 1 – 2021 Historic Ellianos Store Financial Performance

• The table below includes information about the actual sales of franchised Ellianos Stores during Ellianos’ 2021 fiscal year (these Stores include 4 stores operated by Ellianos’ officers). The included Stores were open the entire fiscal year (the 3 Stores that opened during 2022 are not included).

• Ellianos compiled the franchised sales data from the information submitted to it by its franchisees for purposes of royalty reporting and from records maintained by Ellianos’ officers for Stores they operate. Ellianos excluded one store as it is not Ellianos’ traditional drive-thru model. Ellianos believes the information submitted to be accurate, but Ellianos has not audited or otherwise verified that information.

All Locations

• Average Gross Sales:  $1,058,156
• Average Discounts:  $28,422
• Average Net Sales:  $1,029,734

• High Net Sales:  $1,385,398
• Low Net Sales:  $581,401
• Median Net Sales:  $1,005,555

• Average Transactions:  138,209
• Number of Stores Included:  16
• Number of Stores at or Above Average Net Sales:  7
• Percentage of Stores at or Above Average Net Sales:  44%

Top Quartile

• Average Gross Sales:  $1,388,042
• Average Discounts:  $40,078
• Average Net Sales:  $1,347,964

• High Net Sales:  $1,385,398
• Low Net Sales:  $1,297,676
• Median Net Sales:  $1,345,390

• Average Transactions:  176,729
• Number of Stores Included:  4
• Number of Stores at or Above Average Net Sales:  2
• Percentage of Stores at or Above Average Net Sales:  50%

Second Quartile

• Average Gross Sales:  $1,139,138
• Average Discounts:  $25,646
• Average Net Sales:  $1,113,491

• High Net Sales:  $1,253,563
• Low Net Sales:  $1,025,601
• Median Net Sales:  $1,087,400

• Average Transactions:  $143,927
• Number of Stores Included:  4
• Number of Stores at or Above Average Net Sales:  2
• Percentage of Stores at or Above Average Net Sales:  50%

Third Quartile

• Average Gross Sales:  $973,350
• Average Discounts:  $34,992
• Average Net Sales:  $938,358

• High Net Sales:  $985,510
• Low Net Sales:  $869,485
• Median Net Sales:  $949,219

• Average Transactions:  132,050
• Number of Stores Included:  4
• Number of Stores at or Above Average Net Sales:  3
• Percentage of Stores at or Above Average Net Sales:  67%

Bottom Quartile

• Average Gross Sales:  $732,094
• Average Discounts:  $12,970
• Average Net Sales:  $719,124

• High Net Sales:  $860,939
• Low Net Sales:  $581,401
• Median Net Sales:  $717,078

• Average Transactions:  100,130
• Number of Stores Included:  4
• Number of Stores at or Above Average Net Sales:  2
• Percentage of Stores at or Above Average Net Sales:  50%

• For fiscal year 2021, the Average Gross Sales of the Ellianos Stores included that are not operated by an officer of Ellianos (which is 12 Stores) is $983,646. The number and percentage of Stores that met or exceed that amount are 5 (42%). The Median Net Sales for those Stores are $978,717.66. The High and Low Net Sales are $1,445,700 and $586,949, respectively.

Part 2 – 2020 Historic Ellianos Store Financial Performance

• The table below includes information about the actual sales of franchised Ellianos Stores during Ellianos’ 2020 fiscal year (these Stores include 3 stores operated by Ellianos’ officers). The included Stores were open the entire fiscal year.

• Ellianos compiled the franchised sales data from the information submitted to it by its franchisees for purposes of royalty reporting and from records maintained by Ellianos’ officers for Stores they operate. Ellianos excluded one store as it is not Ellianos’ traditional drive-thru model. Ellianos believes the information submitted to be accurate, but Ellianos has not audited or otherwise verified that information.

All Locations

• Average Net Sales:  $846,331
• High Net Sales:  $1,246,506
• Low Net Sales:  $503,487
• Median Net Sales:  $836,331

Top Quartile

• Average Net Sales:  $1,130,832
• High Net Sales:  $1,246,506
• Low Net Sales:  $1,048,898
• Median Net Sales:  $1,097,091

Second Quartile

• Average Net Sales:  $931,318
• High Net Sales:  $1,001,609
• Low Net Sales:  $865,974
• Median Net Sales:  $926,371

Third Quartile

• Average Net Sales:  $773,171
• High Net Sales:  $806,689
• Low Net Sales:  $718,111
• Median Net Sales:  $794,715

Bottom Quartile

• Average Net Sales:  $550,003
• High Net Sales:  $599,107
• Low Net Sales:  $503,477
• Median Net Sales:  $547,423

Part 3 – Average (and Median) Income and Costs Statement of Ellianos Stores Operated by Ellianos’ Officers

• The table below includes the average income and costs statement of Ellianos Stores operated by Ellianos’ officers that were open for the full year of 2021. No units were excluded.

• This data was compiled from records maintained by Ellianos’ officers. Ellianos believes the information submitted to be accurate, but Ellianos has not audited or otherwise verified that information. Ellianos franchisees do not submit similar information that can be included.

2021

Total Income (Net Sales):  $1,246,988 (100.0%)

Total Cost of Goods Sold:  $453,093 (36.3%)

Gross Profit:  $793,895 (63.7%)

Payroll Expenses:  $290,362 (23.3%)

Royalties:  $62,123 (5.0%)

Other Expenses

• Advertising:  $16,337 (1.3%)
• Bank Service Charges:  $1,740 (0.1%)
• Credit Card Fees:  $31,653 (2.5%)
• Dues and Subscriptions:  $9,810 (0.8%)
• Insurance:  $10,230 (0.8%)
• Licenses and Permits:  $330 (0.0%)
• Office Supplies:  $1,036 (0.1%)
• Professional Fees:  $2,246 (0.2%)
• Repairs and Maintenance:  $8,952 (0.7%)
• Supplies:  $28,304 (2.3%)
• Uniforms:  $1,744 (0.1%)
• Utilities:  $25,809 (2.1%)
• Total Other Expenses:  $138,190 (11.1%)

Total Expenses:  $490,676 (39.4%)

Net Operating Income:  $303,219 (24.3%)

2020 (for comparison)

Total Income (Net Sales):  $1,100,022 (100.0%)

Total Cost of Goods Sold:  $379,295 (34.5%)

Gross Profit:  $720,727 (65.5%)

Payroll Expenses:  $255,688 (23.2%)

Royalties:  $54,482 (5.0%)

Other Expenses

• Advertising:  $12,981 (1.2%)
• Bank Service Charges:  $822 (0.1%)
• Credit Card Fees:  $27,941 (2.5%)
• Dues and Subscri  $8,761 (0.8%)
• Licenses and Permits:  $471 (0.0%)
• Office Supplies:  $486 (0.0%)
• Professional Fees:  $4,352 (0.4%)
• Repairs and Maintenance:  $9,767 (0.9%)
• Supplies:  $40,810 (3.7%)
• Uniforms:  $1,393 (0.1%)
• Utilities:  $25,077 (2.3%)
• Total Other Expenses:  $140,894 (12.8%)

Total Expenses:  $451,064 (41.0%)

Net Operating Income:  $269,663 (24.5%)

• 75% of the units included met or exceeded the averages stated.

• “Total Income” includes all “Net Sales” which includes all revenue from the sale of all services and products and all other income of every kind and nature (including on-premise sales, off-premise sales, and any other type of sale) related to the Franchised Store (excluding revenue from the sale of stored value gift cards or gift certificates but including revenue when gift certificates are redeemed or stored value gift cards are debited), whether for cash or credit and regardless of collection in the case of credit.

• Net Sales does not include: (1) any bona fide documented federal, state, or municipal sales taxes collected by you from customers and paid by you to the appropriate taxing authority; (2) the sale of food or merchandise for which refunds have been made in good faith to customers; (3) the sale of equipment used in the operation of the Franchised Store; (4) customer promotional discounts approved by Ellianos; and (5) employee meal discounts.

• “Gross Profit” means Total Income minus Total Cost of Goods Sold.

• “Total Cost of Goods Sold” includes the delivered cost of food, beverages, paper, and promotional items to the Restaurants. Delivered costs include distribution and freight costs.

• “Advertising” is a fee of 1% of Net Sales as defined in the Franchise Agreement. This amount also includes local store marketing.

• “Insurance” includes General Liability and Worker’s Comp.

• “Payroll Expenses” includes unit hourly labor, which is comprised of the average hourly rate and the number of hours worked. The cost of labor will vary from location to location and will be dependent upon factors beyond Ellianos’ control, including, without limitation, local minimum wage laws and local labor market conditions. Labor costs also include the salaries of general and assistant managers. Most stores have one manager. The other components of labor expense are payroll taxes, health insurance, vacation, wages, sick pay, bonuses, and workers’ compensation insurance.

• “Repairs and Maintenance” includes repairs or maintenance for building and equipment including pest control service.

• “Royalty” is percentage of Net Sales as defined in the Franchise Agreement. These units pay the same royalty fee as franchised units.

• “Total Supplies” includes all general store supplies, cleaning supplies (including janitorial services), smallwares, and prepaid cards.

• “Utilities” includes garbage service, gas and electric, sewer, telephone and internet, and water.

• “Net Operating Income” means Gross Profit minus Total Expenses.

• Franchisees may incur other costs in connection with the operation of an Ellianos Store, which are not included above, such as occupancy costs (i.e., rent or mortgage payments), debt service (including interest), owner compensation, automobile, travel and entertainment expenses, cash long/short, donations, and depreciation and amortization.

• Expenses will vary from franchisee to franchisee and from location to location, and are dependent upon seasonal, local, and other factors beyond Ellianos’ control.

• Some outlets have earned this amount. Your individual results may differ. There is no assurance that you’ll earn as much.

Section VI – Ellianos Coffee Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️