Everywhere you turn, it feels like a milk tea shop is popping up nearby. These drinks, also known as boba, were introduced to the United States in the 1990s and has continued to grow in popularity since that time. With a compound annual growth rate (CAGR) of 7.51%, this billion dollar industry is long past being a fad and is projected to see steady growth through the current decade.

With that said, if you’re into franchising milk tea with a name that’s already familiar in the market, it’s time to check out Coco Fresh Tea and Juice. The brand has been around since 1997 and has been serving fresh brewed teas, boba, fruit teas, juices, and more around the world.

How much does it cost to open Coco Fresh Tea & Juice? To start, you’ll need to have a minimum net worth of $100,000. The investment range to start a Coco franchise is $241,000 to $1,340,000 (the average being $790,500) and the franchise fee is $60,000. The brand has been actively pursuing franchisees to invest in and operate the concept in the United States. Learn more about the risks and rewards I see in Coco Fresh Tea and Juice franchise analysis below. You can also take our 7-minute quiz to be paired with the right bubble tea franchise for you.

Financial Requirements and Fees

These are the financial expenses you can expect when you franchise Coco:

The franchise fee stated above is only the fee for a single unit franchise. Coco also accepts 3-unit franchises at the price of $120,000. Essentially, if you buy two you get one for free.

In addition to these expenses, Coco charges a royalty fee of 6% from your net sales from the preceding month and a marketing fund contribution of 2% from the net sales of the preceding month. The term of the franchise agreement is 5 years.

Average Sales / Revenue per Year

It’s really hard to find any reputable data about revenue numbers for this franchise. Although publicly available sales data is limited, the company has expanded by 142% from 3,500 stores in 2019 to 5,000 in 2023. But keep in mind that most of this growth is international. At the time of writing there are only 31 units operating in the United States. Ideally, you would get a clear understanding of the revenue numbers and profitability of this concept in the United States before investing. While the concept is clearly a winner abroad, it’s not a slam dunk domestically just yet.

Coco Fresh Tea & Juice Franchise Facts

Coco Fresh Tea and Juice is a boba shop that originated in Tamsui, Taiwan in 1997. It was founded by Tommy Hung. Coco’s first store in the United States was in New York in 2011.

Enjoy a Coco Tea on the beach.

From its name, Coco is all about offering more than just milk tea in their menu. They have fresh teas, macchiato teas, chocolate drinks, fruit teas, Yakult teas, slush, and smoothies. Toppings include pearls, pudding, jellies, taro rounds, and sweet potato.

To franchise Coco, you’ll need to create an account with them here. After successfully creating an account, you can proceed to fill up their application form online and wait for their franchise representative team to do an online interview with you. Be prepared with your business proposal and market research. By the end of this process, you can expect to have a final interview with their senior management.

The signing of the franchise agreement comes next if both parties find each other agreeable. Once things are official you’ll go through their training and pre-opening preparation. Your grand opening comes next and Coco will provide you with on-site support during your big day.

The estimated timeline of the franchise application process is:

• Online Application & Review – 2 weeks
• Business Proposal & Final Interview – 2-4 weeks
• Final Interview Arrangement – 1 month to 2 months

Tommy Hung remains as the chairman of CoCo Fresh Tea & Juice as of the time of this writing. Their headquarters is located in Taiwan.

How Much Does Coco Fresh Tea & Juice Make in Profit?

There is no official report on Coco’s profit as of this moment. The average profit margin for a boba tea shop is between 20% and 30%. This means that for every $100 in sales, a boba tea shop can expect to make a profit of $20 to $30 after expenses. Here’s the general overhead of a Coco Fresh Tea & Juice:

• Cost of ingredients: The cost of ingredients for boba tea is relatively low, which means that boba tea shops have a good profit margin. However, the cost of ingredients can vary depending on the type of ingredients used and the location of the boba tea shop.
• Labor costs: Labor costs are another important factor that can affect the profit of a boba tea shop. The cost of labor will vary depending on the size of the boba tea shop and the wages paid to employees.
• Overhead costs: Overhead costs include rent, utilities, and marketing expenses. These costs can vary depending on the location of the boba tea shop and the size of the business.

Advantages of a Coco Fresh Tea & Juice Franchise

Coco Fresh Tea & Juice provides many advantages if you franchise with them. Here are a few:

Menu Variety

Coco’s menu ranges from fresh brewed teas to milk tea, smoothies, coffee, yogurt drinks, and fruit teas. There are so many flavors of drinks one can choose from which makes them a very interesting milk tea place to go to.

Branding & Design

The design that Coco uses for their branding is very eye catching and the company has won awards for its design elements. It’s cute and fresh which makes their milk tea brand appealing to young audiences and those who are fans of milk tea.

The brand’s logo is a simple, yet effective design that features the word “CoCo” and accompanied by the tagline “Fresh & Naturally Made,” which reinforces the brand’s commitment to using fresh ingredients.

CoCo’s packaging is also designed to convey freshness and quality. The brand’s cups and bottles are clear, so customers can see the fresh ingredients inside. The packaging also features the brand’s logo and taglines, which reinforce the brand’s identity.

Spark Up Every Moment.

Global Market

Coco may only have around 20 stores in the United States with only 11 to 50 employees at the moment but they have over 4,500 locations outside the United States. They are found in countries such as Canada, United Kingdom, Japan, and Hong Kong. Coco is also bound to grow bigger because they are continuing to expand in the United States.

The bubble tea market in the United States is currently valued at $640 million according to this article in Bloomberg. The industry is projected to reach $2.2 billion within the next decade (a 300% increase).

Way to Reach an Asian Audience 

If you plan to open the concept in an area with a significant Asian population then you could reach an appealing customer base. Bubble tea has gained significant traction, especially among younger individuals, driven by platforms like TikTok. The growth of bubble tea and K-pop has also increased the U.S.’s receptivity to Asian culture.

Challenges of a Coco Fresh Tea & Juice Franchise

Even a popular brand like Coco has their set of challenges. Here are some of them you should know about:

Competition

There are over 3,601 milk tea shops in the United States and Coco needs to compete with them to be seen. They’ll have to work hard in creating ads and market their brand so they won’t get left behind.

Limited Public Financial Information

Coco has a lack of financial information that’s open to public which makes it difficult for interested franchise applicants to study whether or not this franchise is worth the investment. They’ll personally need to meet with Coco to know all these details and though that may be a good thing to get firsthand information from the brand itself, it can also take up a lot of time.

Is the Coco Fresh Tea & Juice Franchise Right For You?

Coco Fresh Tea and Juice remains to be a strong contender in the milk tea market in the United States and around the world. However, because of a lack of financial information made publicly, it’s difficult to see how they’re growing in the U.S. market. It would be best to contact Coco personally and have a legal advisor go through the Franchise Disclosure Document and Agreement once you have it with you. If you can, try to visit some Coco units in the United States. Confirm there is sufficient traffic and get an understanding of the markets where this concept is already performing well.

Outside a Coco Fresh Tea and Juice location.

What is an alternative Coco Fresh Tea & Juice franchise?

If you’re looking for other milk tea brands, check out Chatime. The brand originated in Taiwan and has over 23 locations in the U.S. but over 3,000 worldwide. They also sell a wide variety of boba drinks in their menu as well as an assortment of toppings to add on.

You Might Like: Is the Sharetea Franchise a Good Investment? (Cost + Fees)

To franchise Chatime, expect the investments to be around $479,100 to $1,139,200 with a franchise fee of $40,000 to $78,000. To know more about Chatime, check out our full guide to franchise them here.

A great way to know if a milk tea franchise is worth it is to read more guides like this and sit down with their franchise team to thoroughly discuss your concerns with them. I hope this guide was able to help you in your quest to finding the best milk tea franchise this year.