If you have ever had plans to own a Starbucks, you must have had the idea that you will be opening a Starbucks that will be your franchise. However, Starbucks will own the stores and will also operate them. But that does not mean you will not be able to stay associated with the brand at any time, you can always open a licensed store and as per estimates 40% of Starbucks stores operating in the United States are all licensed. Although these stores are not franchises, Starbucks has a good bit of control over them.
Reasons why Starbucks Franchise does not Happen
Starbucks is essentially America’s success story. The number of stores is growing but the reputed coffee company is also striving hard to improve its online presence by extending loyalty programs on various digital platforms and mobiles as well. One of the strategies of Starbucks has been to increase the number of stores and the construction of reserve stores spaces in crowded markets.
The growth of the online store is achieved by expanding the portfolio of what it offers by targeting a diverse target audience of coffee buyers and enthusiasts. But there is one way in which Starbucks has made itself different from the rest and that is by keeping franchising Starbucks at bay.
As compared to the other competitors like McDonald’s and Dunkin’ Donuts, Starbucks has grown without franchising. However, if you are still thinking of opening a Starbucks outlet, you can do the following-
1. Getting a Competitive Position
If you want to operate as a licensed store, your store must be located in an area that has high traffic. You must have seen the Starbucks stores operating are in areas where it is a commercial hub or close to a shopping center. These stores can also be found in hotels, hospitals, and grocery stores.
In some cases, the licensed stores of Starbucks are run by Target, which is a larger company. However, this is not the case always. Even if the staff and employees are under the larger controlling company, yet they must follow the norms of Starbucks. As of 2018, there were as many as 6.031 Starbucks licensed locations.
2. Apply for License
Before you start the licensing process, you must register with Starbucks’ Branded Solutions portal. After registering, the application process can start. You must provide details about the business and other information like your name, location, and your contact details. It is mandatory to mention the type of products you wish to offer.
While you are completing the application process, you must specify why you will be a good, licensed store owner. You must justify with reasons and argue why your store will be regarded as a competitive one in a larger market. Having gone through the information you provide, Starbucks will take into account the details and contact you if it finds your application makes sense.
3. Prepare Financially
Store design, training of staff, installing equipment are some of the assistance that a licensed store owner will receive aside from other support. But you must be financially ready to make the business a success.
The brand will expect that you have some amount of funds available when you apply for the licensed store. As far as Starbucks franchise cost is concerned, you must have at least $700,000 as liquid assets. So, you must have sufficient funds available and adequate assets to make your licensed store a success.
How Much to franchise a Starbucks Licensed Store and What are the Benefits
By now, Starbucks does not give franchises but it does allow you to open a licensed store that the brand will have absolute control over including product quality and more. Roughly, speaking, you would require approximately $315,000 as an investment for becoming a licensor.
Benefits of Opening a Licensed Starbucks Store
Enjoy the following benefits by opening a licensed store at Starbucks.
- You can create a community place for the core customers of Starbucks even while at play, on the road, or at play.
- You can offer food items of the highest quality and standard that will also foster perfect pairings and improve ticket averages.
- Derive benefits of the operational innovation
- Provide expresso that is handcrafted and blended beverages that customers prefer.
In turn, Starbucks will help you with promotions, onsite visits, store design, equipment, support and training, food, and the Starbucks menu.
