The Coffee Bean And Tea Leaf
The Coffee Bean & Tea Leaf offers premium coffee beverages, teas, and food items in traditional stores or special distribution sites like hotels and airports. Known for its wide range of products and locations, it operates in the quick-serve restaurant sector.
The Coffee Bean And Tea Leaf franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment for opening a single Traditional 'The Coffee Bean & Tea Leaf' store ranges from $940,665 to $1,430,177, including $92,500 to $142,000 which must be paid to the franchisor or its affiliates. For a Special Distribution Store, the range is $619,500 to $1,000,000, with $98,000 to $127,000 going to the franchisor or its affiliate. [p.1, p.33]
What is the initial franchise fee?
The Initial Franchise Fee is paid upon execution of the Agreement and is deemed fully earned at that time, being non-refundable. It represents payment for the right to use the Marks and the System in developing and operating a Licensed Store [p.104].
What are the ongoing royalty and advertising fees?
The ongoing royalty fee is calculated as 10% of the Gross Revenues from each Licensed Store, paid within 10 days following the end of each Accounting Period [p.198]. Additionally, an advertising and promotional materials fee equal to 2% of the Gross Revenues is also paid concurrently with the Royalty Fee [p.105].
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 provided. However, renewal options are available if you give notice as required by Section 3.2(a) [p.275]. The agreement may allow for renewal upon the same terms or on a week-to-week basis depending on the franchisor's discretion and legal requirements [pp.92-186].
Can I sell or transfer my franchise, and what does that require?
According to the FDD, selling or transferring your franchise requires approval from the franchisor [p.408]. The conditions for such approval are detailed under Item 17(m), "Conditions for franchisor approval of transfer." This isn't specified in the excerpts.
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the agreement on any grounds available by law [p.408]. However, under Section 13.1-564 of the Virginia Retail Franchising Act, it is unlawful for a franchisor to cancel a franchise without reasonable cause. If any grounds for default or termination stated in the franchise agreement do not constitute 'reasonable cause,' as defined by law, that provision may not be enforceable [p.417, p.419, p.418].
What financial requirements — net worth and liquid capital — do I need to qualify?
To qualify as a franchisee, you must have an agreed-upon minimum net worth of $50,000 to $75,000 for each store you commit to open [p.44]. Additionally, the Letter of Credit requirement involves providing a $20,000 security deposit per Franchise Agreement, which may require collateral and an annual fee ranging from 1 to 2 percent of the face amount [p.35]. The net worth is calculated as current assets minus total liabilities in accordance with GAAP applied consistently [p.160, p.254, p.362]. This isn't specified in the excerpts regarding liquid capital requirements specifically.
Do I get an exclusive or protected territory?
No, you do not receive an exclusive territory. You may face competition from other franchisees and outlets owned by the company or its affiliates. However, during the term of your Franchise Agreement, the company will not open or operate a 'The Coffee Bean & Tea Leaf' Store within your Designated Territory, except at Special Distribution Sites [p.51].
What training and ongoing support does the franchisor provide?
The franchisor provides an Initial Training program that includes classroom and on-the-job training, as well as a 5-day Owner Training program for an owner and one other person designated by them. This Owner Training focuses on the system and operations of Coffee Bean Stores. Additionally, ongoing support may include products, training, and other services provided by subsidiaries like CBTL Singapore and CBTL Malaysia to international franchisees outside the United States [p.9]. The franchisor also offers training programs conducted by experienced staff members or store managers [p.48].
How many franchised outlets are there, and how many have closed or been terminated?
According to the FDD excerpts, as of December 31, 2024, Jollibee has a total of 840 franchised Jollibee® restaurants operating in the Philippines. Additionally, outside of the Philippines and the U.S., there are 122 franchised Jollibee® restaurants operating worldwide. For The Coffee Bean & Tea Leaf franchise system, during the fiscal year ending December 31, 2024, a large number of franchised outlets (31), which is more than 30%, were terminated, not renewed, or ceased operations for other reasons [p.5].
Does the franchisor share any financial performance or earnings information?
The franchisor does not make any financial performance representations other than the preceding one. However, if you are purchasing an existing outlet, they may provide actual records of that outlet [p.76]. Additionally, written substantiation for such financial performance representations can be provided upon reasonable request [p.76].
What am I restricted to selling, and where must I buy supplies?
You are restricted to selling only the 'Coffee Bean Products' specified by the franchisor, which include specific espresso drinks, roasted coffee beans, premium teas, baked goods, snacks, and other food items. You must purchase all Coffee Bean Products from the franchisor or a supplier designated by them [p.37]. This includes Proprietary Products like coffees, teas, and other ingredients that are manufactured according to their proprietary recipes [p.37].