By Saksham Arora For those who don’t know yet, well, the original name of Krispy Kreme was “The Krispy Kreme Doughnut Company” which was founded in 1937 in North Carolina, USA. Even today, those first fried doughnuts with the sugar coating are the same recipe and type of doughnuts that people liked back then, and they still maintain the same taste as well as quality. But if you are wondering like when did this company made it to India, well, you should know that the opening of the first Krispy Kreme shop in 2013 in Bangalore was a landmark for the company.
The company is now deeply rooted in Bangalore as well as in Hyderabad, Chennai, and other major cities of South India where they are offered in a variety of flavors such as fresh doughnuts, coffee, and other beverages. So, if are closely following how fast Krispy Kreme stores are growing in India, then you must already be familiar with their franchise opportunity, and today specifically, we will be taking a good look at what is the Krispy Kreme franchise cost in India, who can apply, and how profitable it can get for you. So, let’s get to it then, shall we?
What is the Cost of a Krispy Kreme Franchise in India?
We know that many of you are just here to know how much it will cost you to start a Krispy Kreme franchise right here in India. Well, if that’s the case, you shouldn’t skip past any point we talk about in this particular section. Alright, here is the initial investment breakdown:
Initial Investment: The cost of starting a Krispy Kreme business in India can vary. But how much are we talking about? Well, a rough estimate would lie between ₹20 lakhs and ₹50 lakhs. This should include expenditures for store setup, buying items, and ensuring that Krispy Kreme’s high-quality standards are met.
Franchise Fee: In India, the franchise fee for Krispy Kreme is not publicly mentioned, but looking at how much it costs in other nations, we can say that it would be anywhere around ₹10 lakhs to ₹15 lakhs. That specific fee is the money spent on granting the license to operate by Krispy Kreme, you know?
Royalty Fee: Keep in mind that this is a very important and only way that Krispy Kreme gets paid by you as the owner, it is also a huge part of your paycheck that a shop makes. Like, sometimes, a percentage of wages will be the owner’s salary or the manager’s income. Just to give you an idea, well, this fee is usually at a rate of 4.5% of the total sales of your store.
Marketing Fee: Well yes, there is this marketing fee thing as well, which will be around 3.5% of the sales you make, and that’s just because of the money spent on marketing-related things, both offline and online.
Store Setup: Keep in mind that the size of the store can vary between 150 to 550 square feet, hence it could be set up in more confined spaces if needed. And just so you know, the air conditioning, internet connectivity, and optional delivery services are all examples of the investments you will have to make before the store can be successfully operated.
How Profitable is a Krispy Kreme Franchise in India?
When it comes to investing in any franchise, it is crucial to figure out how soon one expects to recoup aka recover the investment and start earning profits, which is a pretty fair thing in our opinion. Just to give you an idea, well, in the case of Krispy Kreme, the Return on Investment (ROI) is estimated at around 1 to 1.5 years. Depending on your store’s location and your management skills, this period can change significantly.
Not just that though, as a franchise owner, one reason to love Krispy Kreme in India is that you will be given 95% of all the revenues drawn from the establishment. This means a massive chunk of profits is given to you whilst paying Krispy Kreme 5% in royalties and fees, a pretty low amount.
Requirements to Apply for a Krispy Kreme Franchise
In order to be considered for the position of Krispy Kreme, you must first satisfy specific financial obligations, but like what? Well, here are two main examples:
- Net Worth: As per the brand itself, well, the franchisee owner must have at least about ₹16 crores as net worth. This is just a way to make sure that the approval to the franchise is only given to those who can actually support the store or outlet when going gets tough, financially.
- Liquid Assets: Not just that though, you must possess a certified sum of at least ₹2.8 crores in current cash equivalent. Liquid capital means that you are able to quickly come up with the necessary funds, cash on hand or otherwise, through the sale of easily convertible assets, you know?