Is the Crumbl Cookies Franchise Cost Too Expensive? (My Opinion)

Crumbl Cookies was founded in 2017 by cousins Sawyer Hemsley and Jason McGowan, who opened their maiden outlet in Logan, Utah (during the time Hemsley was still enrolled in college). As stated on the company’s website, the brand now has more than 300 bakeries in 36 states, making it “the fastest-growing cookie enterprise in the country.”

You could be wondering how they did it. The simplest answer is one extraordinary cookie recipe, combined with a brilliant branding and social media promotion strategy.

How much will it cost to open a Crumbl Cookie franchise? Expect the total investment to cost between $229,666 – $574,833 depending on where you plan to open. There’s also a franchise free of $25,000, which is standard for a food franchise. 

Want to learn my opinion of this rapidly-growing cookie franchise? I share the pros, cons, and whether or not this concept could be a fad below. You can also take our 8-minute franchise quiz to get matched with a business opportunity that fits your skill set.

Financial Requirements and Fees

Lemon Crumbl Cookie.

Before getting involved in a Crumbl Cookies, know this isn’t a passive investment. This is a business you’ll need to actively operate, market and grow. If you’re not prepared to be involved in the day-to-day operation of the business, this is not the business for you. Here’s what the financial requirements of this business look like.

Financial Requirements

Crumbl Cookies is a relatively new franchise having only opened its doors in 2018. The company’s primary goal, according to them is to make delicious cookies in a unique and exciting way. To be honest, the company can be credited with being a pioneer in the field of cookie marketing and presentation. A weekly rotating cuisine, open-concept facilities, and a fantastic pink box are among their key advantages.

A Detailed List of the Fees

The following is a breakdown of the fees required to open a Crumbl Cookies franchise.

When you buy a franchise, you need to know how much money and time will be required to succeed. You’ll need a lot of equipment though such as inventory, ovens, food disposal machines, venting systems, furniture, and a retail space.

Fortunately, one of the benefits of choosing a franchise is that the company will specify exactly what equipment to purchase from vendors. If you were to open your a bakery instead, you’d want to check out these goods and assess the advantages and disadvantages of each piece of equipment to purchase.

How Much Profit Does Crumbl Cookies Franchisees Make Per Year?

Company revenue/sales per year:

Crumbl topped a list of the top 25 chain stores with the fastest growth evaluated by system-wide gross sales in the country, according to the latest study by Nation’s Restaurant Information (NRN). Crumbl’s total gross sales increased by 93 percent to $53.4 million in 2020 compared to the previous year. This is stunning growth.

In 2019, the company’s overall average gross sales per store was $1.3 million with a net income of $284,000 per store. As a prospective franchisee, it’s encouraging to note that this shop concept offers a high per-retailer profit margin. Another encouraging metric is that you could earn a good living by operating a single location. This isn’t possible with many franchise options.

Related Reading: Is a Caribou Coffee Franchise Still Worth the Investment? 

Crumbl had a net revenue loss in 2018, which was the first year the company began franchising. The gourmet cookie company, on the other hand, made a comeback in the following year, due largely to increased franchise expansion. It’s worth mentioning Crumbl is a smaller food and beverage franchise, its system-wide revenues aren’t as high as those of other franchise concepts that have been established for decades.

Number of units:

According to the company’s website, they currently have over 300 bakeries (no definite figure) in 36 states. Crumbl Cookies stated in late September 2021 the company opened 254 outlets in over 30 states in just four years. According to Jason McGowan, co-founder, and CEO, there is no set unit goal number. Time will tell how far this concept can go.

Average Gross Revenue Per Store: $53.4 million (System-wide sales) ÷ 300 units = $178,000.

Industry Average Profit Margin: In 2019, the food processing industry’s gross profit margin was 22.05 percent, according to CSIMarket. This was significantly lower than the market’s overall average of 49.4%. In addition, the food processing EBITDA margin was 9.56 percent, which was lower than the whole market number of 16.59 percent.

In the end, the food processing industry’s net profit margin was only 5.16 percent. The whole market’s net margin was 7.81 percent, up from 7.79 percent the previous quarter. The industry’s severe competitiveness may have resulted in such narrow margins.

Projected Annual Profit Per Store:

Crumbl Cookies SWOT Analysis

Before opening a franchise business, there are a few things to think about. You need to consider additional variables, such as training and long-term firm stability in relation to the financial considerations and sustainability of the business. Given these factors, here’s a SWOT analysis of opening a Crumbl Cookies location so you understand the strength, weakness, opportunity, and threat of the company.

Strengths

• Social Media Presence. Social media nowadays, as we all know by now, has its own ecosystem. Cookies, in particular, have the ability to spread like wildfire. When you add in a rotating menu of tastes, there’s no shortage of material for the company to make and share. On social media, the majority of food businesses have low participation. Crumbl, on the other hand, is an outlier.

You may have seen Crumbl if you’ve been social media savvy since 2020. The chain has amassed 800,000 fans on TikTok, the latest leading social media network with 80+ million monthly active users, the majority of whom are between the ages of 16 and 24.

Crumbl attracts millions of visitors thanks to a meticulously maintained TikTok page, many of which have become devoted clients. Among Crumbl Cookies’ strongest attributes is its mastery of social media. TikTok and Instagram, for example, are particularly visually driven, and much of the information posted on these channels is related to food photographs and videos.

• Inexpensive franchise fee. Crumbl Cookie’s franchise fee is $25,000, which is in the lower range for a Food and Beverage business. Furthermore, Crumbl has a cheaper franchise fee than one of its industry rivals, Scooped Cookie Dough Bar, which costs a $29,900 starting franchise fee. Crumbl Cookies, in my opinion, has a stronger brand.

• Every week, new flavors. Crumbl Cookies unveils the fresh set of cookie varieties for the upcoming week on Sunday, the shop’s sole day off. Crumbl’s changing menu strategy has helped the business generate awareness towards its limited-edition cookies.

Creating just 4 flavors every week is a savvy marketing strategy that keeps customers interested in what could be on the menu each and every week. Every cookie is unique, so customers feel compelled to visit the store to experience it before it sells out. Cookie connoisseurs never seem to get tired of tasting different flavors each week.

Weaknesses

• Menu changes every week. One of its strengths can also be considered as one of its weaknesses. Shifting the menu every week can be a logistical nightmare. One of the drawbacks is that you should regularly refresh your personnel about each new cookie, which is both time-consuming and costly. You should also devote considerable time promoting the meal and sharing it on social media. If you dislike digital marketing strategies, a more conventional food business that depends on nationwide promotional activities might be a better fit.

On a separate note, this concept performs effectively for businesses with an experimental customer base—those who are more eager to try new things than people who walk into a café knowing exactly what they should eat. Crumbl’s target market is younger, as previously stated.

• Training obstacles. It may be difficult for both franchise owners and employees to gain knowledge and reeducate to meet the weekly shifting menu. One could also end up with a lot of stuff in your storage facility, which will render inventory management more difficult, necessitating the hiring of more people or paying them more.

Opportunities

• Full financial disclosure. Crumbl Cookies publishes income statements for the company’s active and current franchisees to assist potential franchisees in determining whether the chain is worthwhile. However, given the company’s rise in income, it’s simple to see why the company is so upfront with sales and revenue numbers.

• Rapid growth. The company has achieved significant growth since its inception four years ago. It’s incredible all of these establishments have managed to open in less than four years.

In fact, since the epidemic began, well over 180 units have been released with 8 to 10 additional units being released every week as I write this. If that wasn’t impressive enough, the company hasn’t closed a single site since the franchise model was introduced. It’s safe to say that Crumbl Cookies is a hit thus far.

Threats

• Quality control. One of the technical challenges you’ll experience as a Crumbl Cookie franchisee is quality assurance. The regular changing of the menu does keep followers engaged, but training will be more challenging with continuous menu changes. In addition, some menus will inspire lower interest than others. It’s unrealistic to expect a home run at every plate appearance.

• Sustainability, as the product could just be a craze. Certain food trends are timeless while others come and go. For example, frozen yogurt stores were all the craze a decade earlier thanks to social media and youthful customers. Although some frozen yogurt stores remain in business, the concept has passed its prime and became saturated in many markets. Some critics worry Crumbl Cookies could see a similar fate if other copycat bakeries begin to pop-up with a similar marketing strategy.

Is Crumbl Cookies Worth the Cost to Invest?

Crumbl Gift Cards.

Cookie Advantage, Insomnia Cookies, Le Macaron, Krispy Crème, and Cinnabon are just a few of some well-known businesses that compete with Crumbl Cookies. These are a food and beverage brands that compete directly with baked products.

If you consider the comparatively low capital investment, Crumbl Cookies has to be one of the most financially viable cookies or baked products franchises around. If you invest just under $500k and generate a revenue of more than $200,000, you’ve probably made an incredible one-year return on the investment. In 3 years or less, you should see a return on the capital.

But don’t count your chickens before the eggs are hatched just yet. You’ll still need to find a profitable location, promote the business hard, and work hard in the business over the next 3 years to make that happen.

Related Reading: How Much Does a Little Caesars Cost? (My Unfiltered Answer)

It’s not unusual for entrepreneurs to rush into buying a franchise just to find out later to realize they really do not appreciate running it. The adage “know oneself” is surely applicable in this case. It is indeed advisable to invest in a franchise that fits with your passions and is something you’ll be happy operating for at least ten years.

This venture could well be a suitable option for you when you have the necessary finances and a desire to open a gourmet cookie shop. If you’re considering buying a franchise, do some self-reflection beforehand. The common misconception about operating a franchise is that it is a simple method to start a business with an established concept. But this is simply just not the case. Despite the fact that the franchise system could provide support and training, you must be willing to make decisions on your own and take the initiative to market your cookie shop. This buck starts and ends with you.

A Brief History of Crumbl Cookies

For the love of cookies.

In establishing the company, Sawyer and Jason were inspired by the success of pizza and other casual food delivery services. To arrive at their ideal milk chocolate chip cookie recipe, Hemsley and McGowan used A/B testing methodologies. Soon after, they started experimenting with various flavors, which led to the idea of a changeable menu.

Weekly Rotating Menu

Each weekly menu features six flavors, four of these are cycled from a collection of more than 170 varieties. Since launching, order choices have grown to include nationwide shipping and curbside pickup in addition to delivery and takeout. Pies, candies, cakes, and other delicacies serve as inspiration for Crumbl cookies.

Crumbl Cream, a combination of ice cream and milk, is one of the company’s other products. There are two sizes of cookies available: standard and small. As a complement to chilled milk and water, Crumbl Cookies also offer Crumbl Cookies’ ice cream and Crumbl Cream.

The Pink Box

Crumbl’s delectable cookies would be incomplete without their signature pink box. Crumbl’s packaging, be it in a 4-pack, 6-pack, or 12-pack box, are intended to exactly fit each Crumbl cookie side-by-side. The “4-pack” pink container, which is the company’s most famous and well-known, was created in 2018, just a few months after Crumbl launched its first cookie.

Sawyer and his friends at Utah State University designed the distinctive, oblong-shaped box, which is the first of its type. It’s distinctive and Instagrammable thanks to its unusual form and the brand’s signature pink hue, making it ideal for sharing that wonderful boomerang, snapshot, or Crumbl review on various social media platforms.

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