7 Brew
7 BREW offers high-capacity drive-thru coffee stores, known for quick-service coffee and beverages; part of the quick-serve beverage industry.
7 Brew franchise FAQ
How much does it cost to open one — the total initial investment?
This isn't specified in the excerpts.
What is the initial franchise fee?
The initial franchise fee varies based on the number of stores. For the first store, it is $35,000 [p.14, p.98]. For each subsequent store you commit to develop, the fee is $25,000 [p.14, p.25, p.165].
What are the ongoing royalty and advertising fees?
The franchisee must pay a royalty fee equal to a percentage of gross sales on or before Friday of each calendar week [p.98]. There is no specific mention of advertising fees in the provided excerpts; however, the franchisor may advertise using the Brand Fund and provide marketing materials to the franchisees [p.39, p.51] without specifying additional advertising fees.
How long is the initial franchise agreement, and can I renew it?
The initial term of the franchise agreement is 20 years [p.50]. You have the right to renew the License Agreement for three successive 10-year terms under the same conditions as the initial term [p.50].
Can I sell or transfer my franchise, and what does that require?
According to the FDD, if you decide to sell or transfer your franchise rights or a controlling ownership interest, you must first obtain a bona fide, executed written offer from a responsible buyer. This offer should include details of the proposed sale's payment terms and financing sources. You need to send us (the franchisor) a true and complete copy of this offer, which must be a fixed-dollar amount without any contingent payments. The offer can only relate to the rights granted by the agreement and the store, including its physical structure and operating assets. [p.127]
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the agreement for good cause, which includes the failure of the franchisee to comply with any lawful provision of the franchise agreement and to cure such failure after being given written notice and a reasonable opportunity (no more than 30 days) to do so [p.5]. Additionally, the franchisor is not required to grant a successor franchise if certain conditions are not met by the franchisee [p.130]. This isn't specified in the excerpts for other specific grounds of termination.
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts.
Do I get an exclusive or protected territory?
No, you do not receive an exclusive territory. You may face competition from other franchisees, from outlets that the company owns, or from other channels of distribution or competitive brands that the company controls due to their rights regarding Non-Traditional 7 BREW Stores within your Area of Protection [p.45].
What training and ongoing support does the franchisor provide?
The franchisor provides initial training programs for ownership groups, store managers, and hourly employees [p.43, p.101]. This includes a 2-day program for ownership, a 14-day program for management, and a 3-day program for hourly staff. Store managers must pass operations tests to be certified before opening the store [p.44]. Additionally, ongoing training courses and programs are required but limited to no more than 5 days total per year [p.44]. The franchisor also finances various Brand Fund activities including marketing, advertising, and lead-generation programs, as well as providing training materials and support through virtual means [p.38, p.116].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts.
Does the franchisor share any financial performance or earnings information?
The franchisor can provide financial performance information if there is a reasonable basis for it, as long as it is included in the disclosure document [p.61]. However, beyond what is specified in Item 19 of the disclosure document, the franchisor does not make any financial performance representations and does not authorize its employees or representatives to do so either orally or in writing [p.72].
What am I restricted to selling, and where must I buy supplies?
You are required to operate the Store according to 7 BREW's Brand Standards, which regulate what products and services can be offered. You must buy or lease all Operating Assets and other products and services for the Store only according to these standards, and if required, from manufacturers, suppliers, or distributors designated or approved by 7 BREW (which may include or be limited to them, their affiliates, and/or other restricted sources) at the prices the suppliers choose to charge. [p.27] [p.30] This isn't specified in the excerpts for your exact location of supply for non-designated items, but you must ensure that all products and services meet 7 BREW's minimum standards and specifications. [p.30]