Key Points:
- Starbucks does not franchise its stores to individual owners. Instead, the company maintains tight control over brand experience and only allows approved operators to run licensed Starbucks locations.
- Licensing requires ~$315K and suits existing businesses (like grocery stores, campuses, and hospitals); earnings range from ~$50K to $200K+ per location, with multi-site owners earning more.
- Aspiring coffee entrepreneurs should explore franchise alternatives. Options like Travelin’ Tom’s, Aroma Joe’s, Ellianos, and Biggby offer investment ranges from ~$191K to $1.8M+.
It seems that every U.S. city and town has a Starbucks in it, happily serving its eager clients. Over the course of more than 50 years, Starbucks has become the face of coffee in America and throughout the world. It combines the exclusive nature of its coffee drinks with the coffeehouse culture that people have come to know and love.
Given the popularity and abundance of Starbucks locations, you might assume that Starbucks operates on a franchise model. But the reality is there’s no such thing as a Starbucks franchise.
This can be disappointing, particularly to aspiring franchise owners looking for an established, beloved, and profitable business. In this article, we explore why it’s not possible to buy a Starbucks franchise, and what your coffee house franchise alternatives could be.
The History of the Starbucks Brand
Starbucks may be known as the place where anyone can enjoy the quintessential coffeehouse experience. But the truth is this brand began as a simple coffee shop in Seattle, Washington. The original Starbucks location opened in 1971. It was known to locals as a great place to get coffee made with fresh-roasted beans. However, about 10 years later, an investor took the experience to new heights, incorporating the European artistry and culture of a true coffeehouse into the brand’s model. From that moment forward, Starbucks became the place to sip coffee while enjoying great conversation, an excellent book, or a peaceful moment.
From the very beginning, franchising was not in the plans for Starbucks. While the brand began to grow exponentially, particularly throughout the 1990s and early 2000s, it always resisted the idea of letting franchise owners into the mix. The owners of Starbucks believed that by allowing people to invest in a Starbucks franchise, they might be letting go of their control over the brand experience—which was crucial to the Starbucks identity.
How to Buy a Starbucks Franchise
There are a lot of people who want to buy a Starbucks franchise, and they find themselves searching for how to open their own Starbucks location. Much to their dismay, they quickly discover it’s not possible to buy a Starbucks franchise.
However, if you’re completely set on owning your own Starbucks, they do offer a licensing option. Licensed Starbucks locations are typically those smaller satellite coffee stands you find in grocery stores, on college campuses, and inside hospital buildings. They operate slightly differently from the traditional Starbucks storefronts, but they make up a large portion of Starbucks locations in the United States. In fact, approximately 49% of all Starbucks shops are licensed locations.
Related: Understanding the difference between franchise and license business models
How Much Does a Starbucks Franchise Cost?
There is no option to purchase and invest in a Starbucks franchise. However, those who want to own and operate a Starbucks location can purchase a Starbucks license. A license is distinctly different from a franchise—it simply gives you the ability to operate a Starbucks location in a specific spot. While franchise owners may have some control over their business operations and even their products, a licensed Starbucks owner is strictly subject to the rules and regulations of the Starbucks brand. Starbucks retains total control over its products, as it is deeply committed to consistency and quality across all locations. A Starbucks license requires an investment of about $315,000.
What Is the Potential Income of a Starbucks Owner?
When you purchase a Starbucks license and are approved to open a location in a specific business, such as a bookstore or retail store, you’ll quickly see a stream of steady, loyal customers. Starbucks is known for its large following of brand loyalists who are willing to do whatever it takes to get their favorite Starbucks beverage daily.
As a result, there is potential for high revenue on an annual basis, which can lead to a steady income stream for a Starbucks license owner. The number of Starbucks licenses you have directly correlates with your income potential. For instance, an individual with one Starbucks license can earn around $50,000 to $200,000 annually. An individual with up to 20 licenses for Starbucks could realistically earn more than $2 million annually.
Related: See the This Year’s Top Food & Beverage Franchises
Who Makes a Good Starbucks Owner?
While you may not be able to realize your dream of becoming a Starbucks franchise owner, you may be a good fit as a Starbucks license holder if you:
- Own a business in which Starbucks would like to open a location. Local grocery store owners, for example, may be an ideal fit for a Starbucks license.
- Appreciate the high-quality and consistency of the Starbucks product and you’re ready to promote the brand and its offerings within your own location.
- Want to invest in a business without taking on the responsibilities of owning your own franchise.
- Value the community-based atmosphere of the Starbucks brand and you want to create a welcoming and inclusive culture within your own business location.
- Enjoy the excitement of the new and exciting processes that Starbucks is constantly incorporating into its business model to streamline systems while improving the customer experience.
See the Top Coffee Franchises List
Other Coffee Franchises to Own
Fortunately, if you’re looking to invest in a coffee house franchise, you do have other great options to consider. Some top coffee franchise options include:
Travelin’ Tom’s Coffee
Created in 2020, the Travelin’ Tom’s Coffee sets itself apart from other coffee franchise options by specializing in quick, effective service. Its beverages are made in a truck, making the experience unique and mobile. You’ll need to bring at least $30,000 cash to the table to purchase a franchise, and the total investment can range between $191,000 – $246,000.
Aroma Joe’s
A disruptor in the highly competitive coffee space, Aroma Joe’s has been franchising since 2013. It has quickly become a top destination for handcrafted coffee and espresso drinks, unique infused blends, and their signature AJ’s RUSH® Energy Drinks. To open an Aroma Joe’s you’ll need $200,000, and the total investment ranges between $500,500 – $959,000.
Ellianos Coffee
A growing brand with Southern roots, Ellianos offers a distinctive double-sided drive-thru designed for speed and efficiency. In addition to handcrafted coffee and espresso drinks, Ellianos differentiates itself with hearty breakfast and lunch menu items. With a minimum cash requirement of $150,000, you’re looking at a total investment range of $671,500 to just over a million dollars.
Biggby Coffee
Established in Michigan and offering a welcoming, neighborhood atmosphere, Biggby Coffee is one of the leading coffee shop franchise options on the market today. Biggby offers an established brand that is well-known in most communities, and it can easily compete against other top coffee providers. This franchise typically requires an investment between $246,000 and $564,000.
Dunkin’
Formerly known as Dunkin’ Donuts, this brand has tried reinventing itself as more than just a place to grab your favorite glazed donut. In fact, it’s invested more heavily in marketing its coffee and specialty beverages. Its well-known identity across the entire country, combined with its commitment to its franchise owners, makes it one of the best coffee franchise options available today. To open a Dunkin’ franchise, you must have at least $250,000 in assets. The total investment can range anywhere from $210,000 to $1.8 million.
See the Top Coffee Franchises List
