Hurts Donut
Hurts Donut offers unique donuts and espresso in a 24/7 casual setting. Known for distinctive toppings and full-service coffee, this Missouri-based franchise requires significant investment for operation. Part of the quick-serve restaurant industry.
Hurts Donut franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operation of a single Hurts Donut franchise ranges from $504,000 to $825,000. This includes $75,000 to $114,000 that must be paid to the franchisor or affiliate. [p.1]
What is the initial franchise fee?
The initial franchise fee varies based on the number of franchises purchased at the same time. For three territories, it is $90,000, and for five franchises, it is $125,000 [p.20]. For a single unit franchise, the initial franchise fee is $35,000 [p.11, p.68].
What are the ongoing royalty and advertising fees?
The ongoing royalty is 7% of Gross Revenue received or earned by your HURTS DONUT store [p.68]. For advertising fees, you must pay a Marketing Royalty of 2% for system-wide marketing efforts [p.28], and you may request up to the amount of this royalty for local advertising with HDC's discretion [p.77]. Any unused Advertising Fund fees will carry over to the next fiscal year if not fully spent [p.29, p.70].
How long is the initial franchise agreement, and can I renew it?
The initial term of the franchise agreement is not specified in the excerpts. However, you have the right to renew the Franchise Agreement for one additional consecutive five-year term with no additional franchise fee under certain conditions [p.64].
Can I sell or transfer my franchise, and what does that require?
According to [p.5], you can transfer ownership of your franchise, but the franchisor has the right to refuse such a transfer for good cause, which includes failing to meet the franchisor's qualifications or being a competitor. This provision also allows the franchisor to exercise a right of first refusal to purchase the franchise. [p.68] mentions that there is no initial franchise fee upon renewal or transfer, but any applicable Renewal or Resale fee might apply.
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the agreement if there is good cause, which includes the failure of the franchisee to comply with lawful provisions of the franchise agreement and not curing such failure after being given written notice and a reasonable opportunity (no more than 30 days) to do so. [p.5]
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts. The FDD does mention financial responsibility as a criterion for qualification [p.82], but it doesn't provide specific details on net worth or liquid capital requirements.
Do I get an exclusive or protected territory?
Yes, you receive an exclusive territory where the franchisor promises not to establish either a company-owned or franchised outlet selling the same or similar goods or services under the same or similar trademarks or service marks within your defined geographic area [p.34]. However, this exclusivity does not extend to options or rights of first refusal for additional franchises [p.34].
What training and ongoing support does the franchisor provide?
The franchisor provides initial training conducted over a two-week period at its location in Springfield, Missouri, which is required before opening the store. This training covers all necessary subjects as deemed satisfactory by the franchisor [p.33]. Additionally, the franchisor offers ongoing support and may conduct on-site training during the grand opening of the store [p.69], though you are responsible for travel, lodging, and other incidental expenses incurred during these trainings.
How many franchised outlets are there, and how many have closed or been terminated?
The FDD indicates that as of December 31, 2024, there were 15 franchised outlets. However, the number of closed or terminated outlets is not specified in the provided excerpts. [p.44]
Does the franchisor share any financial performance or earnings information?
Yes, the franchisor does provide historical financial performance representations for both company-owned and franchised outlets [p.43]. However, this information is not audited, and the franchisor does not make any financial performance representations beyond what is included in Item 19 of the FDD [p.45].
What am I restricted to selling, and where must I buy supplies?
You must offer substantially all the donuts, products, and services that HURTS DONUT COMPANY has authorized you to provide [p.74]. Additionally, in order to maintain quality standards or achieve economies of scale, you may be required to buy certain types of ingredients or products only from HDC, its Related Party, or a designated supplier [p.74]. You must purchase equipment, smallwares, and furniture from a supplier designated by the franchisor or subject to their specifications [p.21], and display cases must be purchased directly from them. Furthermore, you are required to purchase all other items needed to commence business as specified in the Confidential Operations Manual(s) [p.66].