The food industry is always a profitable area for both beginner and experienced entrepreneurs. Especially when it comes to different countries’ cuisine, like Korean cuisine, where there is not a lot of competition, the profits go even higher. Cupbop is one of those restaurants offering Korean cuisine.
Have you heard of Cupbop before, or do you want to become a franchise with them? It might be an extremely lucrative idea as the restaurant is growing rapidly, and there is extreme potential for profit. This article will look at Cupbop and its franchise system.
About Cupbop and Cupbop History
Cupbop is a quick-service Korean Barbeque franchise restaurant chain which was the United States’ first Korean Barbeque restaurant.
The brand operates over 200 stores, 48 of them in the United States and the rest in Indonesia. They have plans to expand further through franchising as they recently opened a franchising system.
They were founded in 2013 originally as a food truck, but they turned into a corporate restaurant soon later. However, they still keep the spirits by having both storefront and mobile restaurants, like food trucks.
With their exceptional Korean cuisine, they became the star of entrepreneurs looking to enter a niche industry with great income potential.
Franchise Model Table
| Cost Or Fees | Amount |
|---|---|
| Initial Investment | $160,000-$663,400 |
| Franchise | YES |
| Franchising Since | 2017 |
| Franchise-Fee | $40,000 |
| Royalty-Fee | 6% |
| Liquidity | N/A |
| Estimated Outlets | 200+ |
How Much Does it Cost to Open a Cupbop Franchise?
The total required investment, on average, is between $160,000 and $663,400.
The prices mostly boil down to whether you want to have a storefront restaurant or a mobile restaurant. Each has different cost structures, which affects the prices greatly.
For mobile restaurants, the average cost is between $160,000 and $250,000. For storefronts, it starts from $296,200 and goes up to $663,400.
The total investment is affected by the employee number, size of the store, equipment quality, and other operational costs.
Franchise Requirements
As far as the Cupbop’s website goes, they are looking for people who can operate multiple units and have strong management experience with an entrepreneurial spirit. They don’t specify the amount of experience in years or by industry.
Additionally, there are no net worth or liquidity requirements on the financial side. If you possess enough cash to cover the initial investment or can get a loan to cover the amount, you should be good to go.
Cupbop Franchise Profit & Revenue
According to the latest figures, Cupbop’s latest annual sales number is around $64 million. Of the $64 million revenue, $19 million stays as the net profit when the costs and taxes are deducted from it.
Overall Sales
Overall sales for the company are around $64 million annually. There is no specific information per store, but if we divide this number into 200, the average store number of Cupbop, the overall average sales per store is around $320,000 annually.
Franchise Owner Salary
Considering that the company’s profit margin between overall sales and the net profit is about 19%, we can say that the net profit per store is around $60800 annually.
This equals to franchise owner’s salary, as you get to keep all the profit of the store.
This is how we calculated this amount:
| Financial Overview | Percentage of Revenue | Amount ($) |
|---|---|---|
| Individual Franchise Annual Revenue | 100% | 320000.00 |
| Rent | 10.13% | (32400.00) |
| Insurance | 5.06% | (16200.00) |
| Salaries | 20.25% | (64800.00) |
| Franchise Royalty Fees | 5.06% | (16200.00) |
| Utilities | 2.03% | (6480.00) |
| Cost of Goods Sold (COGS) | 25.31% | (81000.00) |
| Labor (Variable) | 13.16% | (42120.00) |
| Total (Expenses) | 81.00% | (259200.00) |
| Net Profit | 19.00% | 60800.00 |
Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis.
Cupbop Payback Period
The net profit per store is around $60,800, and you spend $320,000 on average to open a store. So, to find out how long it will take to earn back the initial investment:
Payback Period = Investment / Yearly Profit = $320,000 / $60,800 = 5.2 years
Based on these figures, it will take approximately 5 years to pay back the initial investment for Cupbop. This time period could be longer or shorter depending on your sales, revenue, and profit figures.
Failure Rate Of Cupbop
Franchised Outlets:
| Year | Outlets at the Start of the Year | Outlets at the End of the Year | Net Change |
|---|---|---|---|
| 2020 | 2 | 5 | +3 |
| 2021 | 5 | 9 | +4 |
| 2022 | 9 | 19 | +10 |
For the Franchised outlets:
- In 2020, the growth rate was (3)/2×100≈150%
- In 2021, the growth rate was (4)/5×100≈80%
- In 2022, the growth rate was (10)/9×100≈111.11%
According to the above-mentioned data, there is no failure rate for franchised outlets as the outlets at the end of the year increased during the span of 3 years.
We can see that the franchised outlets for Cupbop grew from 2020 to 2022, showing a growth rate between 150% and 111.11%.
Training and Support
Cupbop provides both classroom and hands-on training at a facility. This training helps you to have the necessary operational information. The trainings are also individual trainings tailored to you and your experience.
Additionally, Cupbop also provides help with site selection for your store, providing you with their in-house general contractor for construction. This contractor will give you a hand with their own team to make sure the construction goes smoothly.
They also teach the franchise owners local marketing strategies to help you get your name known.
Obligations and Restrictions
Similar to many other big franchises, the franchisees are obligated to only sell products that Cupbop wants them to and approves beforehand.
You can’t sell anything that Cupbop didn’t approve, and you can’t make any changes to the store before getting written approval from Cupbop itself.
Financial Assistance
Cupbop might offer financial assistance to potential franchisees depending on their financial situation, rules, and the availability of funds.
Additionally, depending on the location, they might have relationships with third parties to connect the franchisees with. They don’t have any say in the decision. They only create a bridge between.
Cupbop Franchise Comparison
| Name | Franchise Fee | Royalty Fee | Initial Investment |
|---|---|---|---|
| Teriyaki Madness | $45,000 | 6% | $312,500 – $731,260 |
| Bibibop Asian Grill | $25,000 | 5% | $439,419-$925,024 |
| Cupbop | $40,000 | 6% | $160,000-$663,400 |
Cupbop Franchise Cost: Conclusion
Cupbop is the United States’s first Korean Barbeque franchise restaurant, with around 48 stores in the US and more than 200 in Indonesia.
They are a big restaurant that recently started to franchise to expand the company faster. As a company, they have around 19% profit margin, which is a decent number, and about $60,000 annual net profits per store.
There is no doubt that Cupbop has great potential for all levels of entrepreneurs with an established franchise system and a good profit number. If you are thinking about owning one and you have the necessary qualifications, it could definitely be a good idea.
Cupbop Franchise Cost: FAQ
How much is the franchisee for the Cupbop franchise?
The franchise fee is $40,000 per restaurant. There are discounts for multi-unit operators, depending on the unit number. The franchise fee is paid upfront in a lump sum.
What is the difference between a Cupbop storefront and a mobile restaurant?
Storefront restaurant requires more space, equipment, employee, and time to set up. It is an actual store, whereas a mobile restaurant is much smaller and doesn’t have a property, unlike storefront restaurants.
Can everyone be a Cupbop franchisee?
All you need to do is have enough capital to make sure you can cover the initial investment and some managerial experience. There are no harsh requirements like net worth or liquidity like other franchise brands.
Who founded Cupbop?
Cupbob was founded in 2013 by Junghung Song and J Park. JungSong and his two friends began selling Korean cuisine and soon after became the founder and part owner of Cupbob.
How Many Locations Does Cupbop Has?
As of 2023, there are 48 total store locations, 6 food trucks, and several concession locations.
Where Is Cupbop Headquartered?
The headquarters of Cupbop is at 124 West Main Street, Rexburg, Idaho, United States.
Sources
https://www.cupbop.com/franchise/faq