Profitable Menchie's Franchise (Semi-Absentee)

Fresno, CA (Fresno County)

Profitable Menchie's Franchise (Semi-Absentee)
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Asking Price: $375,000

Cash Flow: $95,000

Gross Revenue: $395,000

EBITDA: $95,000

FF&E: $150,000

Inventory: $3,000*

Rent: $4,918 /Month

Established: 2017

*not included in asking price.

Profitable Menchie's Franchise (Semi-Absentee)

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Business Description

Opened in May of 2017, this well established frozen yogurt franchise is a fully turn-key, semi-absentee run operation located in one of the most highly desirable shopping centers of Fresno.

The current owner invested a tremendous amount of effort and financial resources into building out the space to a high standard. Over $350,000 in capital expenditures were allocated towards the equipment and construction costs at time of opening. All of the business’s hard assets are included in the asking price (over $150k in total value).
The business is being listed for below the replacement cost of opening an entirely new location, without the hassles of dealing with contractors or vendors to build it out from scratch. Additionally, the franchise fee of $40k has already been satisfied, so a new owner won’t need to adopt that cost as they would if opening a new location.

The business is ideally situated in the middle of an immensely busy shopping center that boasts a multitude of national credit tenants and well recognized anchor stores. The center itself is newer and at full occupancy, with further development under way to add additional retail and office spaces to the property. Located off of a main street that garners excellent traffic exposure, the business is conveniently surrounded by a host of office buildings and a plethora of residential neighborhoods in the immediate area. Both the interior and exterior spaces are modern, clean, and impeccably maintained. The owner has taken huge pride of ownership in keeping the premises meticulously neat to create a welcoming environment for current and potential customers.

In a time with rising payroll expenditures due to state imposed wage hikes, it has become increasingly difficult to operate at a healthy margin in the food and beverage space. This business however has very low operational maintenance due to the simplicity of the business model and the lack of need for a large staff to run it optimally.
This lends the owner a fair level of passivity and exempts him from the need of being there constantly to oversee operations. Presently, the owner only allocates between 20-25 hours/week to supervising the business and his duties consist primarily of administrative tasks. Because of the easy to manage model with everything being systemized, no prior industry specific experience is necessarily needed.

Menchie's is a national chain that boasts a store count of 500+ locations, with this particular location being one of the top performing amongst the organization. The franchisor has a conservative growth and expansion strategy, and doesn’t allow any 2 locations to open too closely to one other, protecting each franchisee’s interests while also being cautious to not saturate the brand in the marketplace at the same time. The next nearest location is 4.5 miles away.

Overall sales have continued to grow month over month since the time doors were opened nearly 3 years ago. Gross revenue for the year of 2019 is on pace to hit nearly $400k, with the Seller’s Discretionary Earnings being in the neighborhood of $95k. This is around a 10% increase in growth from the previous year. COGS runs at a very reasonable 20-22%, so there are very healthy margins on both the gross and net basis. It’s an extremely lean and efficiently run operation in all aspects.

The business enjoys a loyal customer base with a healthy flow of repeat patrons. There are dairy free, no sugar, and low carb options also available which allows for the business to cater to a much wider and health conscious clientele. All of the employees are well trained to provide a high level of friendly service, and some of them have been on staff since the location opened. With low turnover and minimal training required to onboard a new employee, any occasional staff changes generally take place smoothly.

This business is highly suitable for an investor seeking a standardized, low maintenance business model that is already cashflowing. All of the necessary systems and operational infrastructure are already in place so it is truly a turn-key affair from top to bottom. An attractive opportunity for someone to seamlessly step into a well run business.

Detailed Information

Location:
Fresno, CA
Inventory:
Not included in asking price
Real Estate:
Leased
Building SF:
1,261
Lease Expiration:
5/31/2027
Employees:
6
Furniture, Fixtures, & Equipment (FF&E):
Included in asking price
Facilities:
The 1,261 sq ft space features a clean and well arranged layout. The entire premises is meticulously maintained and demonstrates tremendous pride of ownership.
Growth & Expansion:
Generous growth opportunities lie in implementing increased marketing efforts. Thus far all of the business coming through the doors has been derived from purely word of mouth and repeat clientele. Incorporating advertising campaigns through online channels like Yelp, Facebook, and Instagram to increase awareness and broadcast promotions could see increased traffic to the store. Expanding the menu’s offerings with items such as shakes could tap into additional revenue streams that are currently being unrealized. Lastly, being a full time on-site owner-operator would allow the company to eliminate employment redundancies, saving on payroll expenses and further increase the business’s net profit.
Support & Training:
Extensive training is offered by the franchisor. Current owner will also make himself available for a period of time to provide further consultation and ensure a smooth transition.
Reason for Selling:
Other business interests
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Dehlan Group

Business Listed By:
Dehlan Group

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