Bruegger’s Bagels is a brand that’s been in business since 1992. With over 260 locations, Bruegger’s Bagels continues to serve kettle-cooked bagels around the United States and if you’re interested in taking a bite out of this business, you’ll be pleased to know they offer a franchising opportunity.
How much does it cost to open Bruegger’s Bagels? To start, you’ll need a liquid capital of $100,000 and a net worth of $500,000. The initial investment to franchise Bruegger’s Bagels will typically range from $693,800 to $1,227,150. This figure includes the franchise fee of $35,000.
But there are challenges on the horizon. In fact, the number of bagel shops in the United States has declined by 2% since 2018. Interested to know more about Bruegger’s Bagels? I dive into the average revenues, advantages, and future challenges of the brand. If you want to be matched with a custom franchise opportunity or book a call with me directly, complete the 7-minute franchise quiz.
Financial Requirements and Fees
These are the following fees and expenses that Bruegger’s Bagels requires:
|Fees / Expenses
|$693,800 to $1,227,150
Below is also a breakdown of the estimated investment:
|Type of Expenditure
|Method of Payment
|Initial Franchise Fee
|$25,000 to $56,250
|Design, Permitting Fees
|$36,000 to $79,000
|Building and Leasehold Improvements
|$278,000 to $508,000
|$21,000 to $103,000
|Furniture, Fixtures, and Equipment
|$222,8000 to $272,900
|$0 to $10,000
|$0 to $10,000
|Start-up Inventory and Supplies
|$10,000 to $14,000
|Grand Opening Advertising
|$3,000 to $5,000
|Utility Deposits and Licenses
|$3,000 to $5,000
|Legal and Accounting
|$5,000 to $30,000
|$6,000 to $12,000
|Additional Funds – 3 Months
|$15,000 to $45,000
|$693,800 to $1,227,150
In addition to these expenses, the royalty fee is 5% of the gross sales and is due weekly. Consider whether or not you’re willing to hand over $5 of every $100 in gross sales to the company before investing just for a royalty fee.
Average Sales / Revenue per Year
The FDD includes information about the financial performance of Bruegger’s Bagels. The average sales for a Bruegger’s Bagels franchise unit is $1.5 million annually. The average profit margin is 10%. According to reports, Bruegger’s Bagels system-wide sales in 2022 reached $167 million.
Bruegger’s Bagels Franchise Facts
Bruegger’s Bagels were founded by Mike Dressell and Nord Brue in 1983 in New York. Their bagels became a hit due to the way it was cooked: they use a process called kettle-cooked in which the bagels are coiled in a kettle. Afterwards, they bake them so the result is a harder or crusty exterior and the inside of the bagel is doughy and soft.
The bagels they sell range from the classic bagels to Cinnamon Raisin, Garlic, Poppy Seed, Everything Bagel, Asiago Parmesan, Rosemary Olive Oil, Whole Wheat Everything and more. They also offer selections such as serving it with cream cheese that’s made in Vermont where the founders originated from, breakfast bagels, and lunch bagels.
The bagel chain has gone through a lot of ownerships through the years. Today, Bruegger’s Bagels is owned by Caribou Coffee who is also owned by JAB Holding Company. The company owns Krispy Kreme Doughnuts, Panera Bread, and other bagel chains such as Einstein Bros. Bagels, Noah’s New York Bagels, and Manhattan Bagel.
To franchise Bruegger’s Bagels, just complete the interest form here and depending on the availability a representative will get back to you.
How Much Does Bruegger’s Bagels Make in Profit?
The average profit margin is 10% according to the FDD. This means if you’re location generated $1 million annual sales that roughly $100,000 would hit your bottom line as profit.
Advantages of Bruegger’s Bagels Franchise
Bruegger’s Bagels have been around for years and these are the advantages you can expect when you franchise with them:
Bruegger’s Bagels is a well-known bagel name in the industry. They’ve been around since 1983, have been franchising seen 1993, and have over 200 stores in the United States. The acquisition of Caribou Coffee has not overshadowed them but has rather placed them in a more popular light along with the fact that they are now in one parent company with other big brands such as Panera Bread, Krispy Kreme Doughnuts, and Peet’s Coffee.
In addition, they are also focusing on expansion particularly in Washington, Seattle, Texas Dallas, and Charleston South Carolina.
The bagel store industry is valued at $1.4 billion in annual sales in the United States according to IBISWorld. This is a food item with broad appeal and a lot of flexibility. Bagels can be adapted into a breakfast sandwiches, lunch, or an easy breakfast with a little cream cheese and butter.
In addition to these factors, the popularity of bagels in the United States has also been influenced by the large Jewish population in the country. Jews have a long history of making and eating bagels, and their influence has helped to make bagels a popular food option throughout the United States.
Bruegger’s Bagels serves more than just your classic bagel with cream cheese. They have a variety of bagels you can choose from and if you franchise with them, customers can have more options which can lead to them returning to try more. Bagel chains have an ability to release new flavors of cream cheese and sandwich options that make a delicious breakfast, lunch or dinner. If you need to feed a large group of people, bagels and cream cheese spread can be easily delivered and dropped off at a school or office.
Sesame seed bagels.
The kettle boiling process is what distinguishes Bruegger’s Bagels from other bagel shops. The boiling helps to create a chewy exterior that is not found in bagels that are not boiled. The stone hearth baking process gives the bagels their signature crust and flavor.
There is a two step process for making Bruegger’s Bagels. The bagels are first boiled in water for 30-60 seconds. This helps to set the exterior of the bagel and gives it a chewy texture. Next, the bagels are then baked in a stone hearth oven at high heat. This gives the bagels their signature crust and flavor.
Challenges of a Bruegger’s Bagels Franchise
Despite being a well-established business since the 90s, Bruegger’s Bagels still pose some challenges. Here are some of them you can expect:
The Number of Bagel Shops is Declining: From 2018 – 2023, the number of bagel shops in the United States is down by 2%. Slowly but surely, there has been an annual decline in the number of bagel shops. Why is this happening? The industry has been declining over the past five years, due to factors such as competition from other types of restaurants, rising costs, and changing consumer preferences. This is a tough industry.
Competition: Though Bruegger’s Bagels are already a well-known brand, they still face a lot of competition. Not only do they have to compete with several other bagel places in New York and in the rest of North America, they also have to compete against their fellow sister brands Einstein Bagel Bros., Manhattan Bagel, and Noah’s NY Bagels.
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There are also non-traditional competitors like coffee shops getting serious about the bagel industry. For example, Caribou Coffee formed a partnership with Einstein Bagel Bros that allows the coffee chain to sell their bagels. Of course, you can also pick up a plain bagel at Starbucks, although the range of options won’t be as broad.
Limited Store Hours: Bagels are synonymous to breakfast so it’s understandable that the store opens early at 6 am for many locations. However, most Bruegger’s Bagels stores close at around 3 or 4 pm. This means you have less hours per day to generate sales. Revenue would grow even bigger if the store would close a little later.
High initial investment: The total investment required to open a Bruegger’s Bagels franchise is significant, ranging from $693,800 to $1,227,150. This all-in price includes the franchise fee, leasehold improvements, equipment, inventory, and marketing.
Is the Bruegger’s Bagels Franchise Right For You?
Bruegger’s Bagels seems like an ideal bagel store to franchise. However, there is tough competition in the bagel industry so you would need to find a really good location for your store. There is also a lack of franchise information coming from the brand themselves so it’s difficult to assess the financial side of the franchise unless you talk to the franchise representative directly.
Bagels for the whole team.
What is an alternative Bruegger’s Bagel store to franchise?
One alternative franchise to consider if you’re looking for more bagel business options is Big Apple Bagels. They’ve been around since 1993 selling bagels and bagel deli sandwiches. To franchise Big Apple Bagels, the franchise fee is $25,000.
There you have it! May this guide help you in deciding if Bruegger’s Bagels is the right bagel franchise for you.