In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:

Section I – Estimated initial investment (franchise costs) for a Wetzel’s Pretzels franchise, based on Item 7 of the company’s 2024 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Wetzel’s Pretzels franchise, based on Items 5 and 6 of the company’s 2024 FDD

Section III – Number of franchised and company-owned Wetzel’s Pretzels outlets at the start of the year and the end of the year for 2021, 2022, and 2023, based on Item 20 of the company’s 2024 FDD

Section IV – News updates on the Wetzel’s Pretzels franchise opportunity

Section V – Presentation and analysis of Wetzel’s Pretzels financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2024 FDD, including information on the:

• fiscal year 2023 average, median, highest, and lowest adjusted gross revenues; and average number of weeks with sales in fiscal year 2023 (out of 52 weeks) for the franchised Wetzel’s Pretzels bakeries that were continuously open and operating under the same franchise owner throughout the fiscal year, by venue type (entertainment center locations, outlet malls, regional malls, non-traditional/transit locations, Walmart stores, concession trucks/trailers, and all bakeries)
  

• number of franchised Wetzel’s Pretzels bakeries in regional malls and outlets that achieved the following adjusted gross revenues: $700,000 and up; $550,000 to $699,999.99; $400,000 to $549,999.99; $250,000 to $399,999.99; and up to $249,999.99

• 2022 average net sales, cost of goods sold, gross profit, operating expenses (labor, rent, other expenses), and net operating income for the 200 franchised Wetzel’s Pretzels regional mall or outlet mall stores that were open and operating for the full 2022 calendar year, and for which the franchisee submitted profit and loss statements in the appropriate format for this period (“Benchmark Stores”)

Section VI – Key ratios, comparables, computations, and analyses for the Wetzel’s Pretzels franchise opportunity (exclusive content for Platinum subscribers)

Section I – Wetzel’s Pretzels Franchise Costs

• Initial Franchise Fee:  $20,000 to $40,000
• Lease Review Fee:  $3,500 to $7,000
• Business Premises:  $5,000 to $25,000
• Leasehold Improvements:  $50,000 to $400,000
• Food Preparation Equipment:  $49,000 to $89,000
• Utility Deposits, Licenses, and Permits:  $500 to $5,000
• Insurance:  $500 to $2,500
• Signs and Menu Boards:  $5,000 to $16,000
• Digital Display Boards:  $5,000 to $7,500
• POS System:  $500 to $900
• Initial Inventory and Smallwares:  $5,500 to $10,000
• Training Fee for Additional Trainee:  $0 to $750
• Training Expenses:  $1,000 to $2,500
• Grand Opening Advertising:  $500 to $2,500
• Office Equipment and Supplies:  $500 to $2,500
• Professional Fees:  $1,000 to $3,100
• Architect, Engineers, and Construction Manager:  $6,000 to $20,000
• Additional Funds – First 90 Days:  $25,000 to $55,500
• Total Estimated Wetzel’s Pretzels Franchise Costs:  $178,500 to $689,750

Section II – Wetzel’s Pretzels Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Initial Franchise Fee:  $40,000
• Royalties:  7% of Adjusted Gross Revenue
• Advertising Fund Contributions:  1% of Adjusted Gross Revenue

Section III – Number of Franchised and Company-Owned Wetzel’s Pretzels Outlets

Franchised

2021

• Outlets at the Start of the Year:  306
• Outlets at the End of the Year:  310
• Net Change:  +4

2022

• Outlets at the Start of the Year:  310
• Outlets at the End of the Year:  322
• Net Change:  +12

2023

• Outlets at the Start of the Year:  322
• Outlets at the End of the Year:  346
• Net Change:  +24

Company-Owned

2021

• Outlets at the Start of the Year:  30
• Outlets at the End of the Year:  33
• Net Change:  +3

2022

• Outlets at the Start of the Year:  33
• Outlets at the End of the Year:  38
• Net Change:  +5

2023

• Outlets at the Start of the Year:  38
• Outlets at the End of the Year:  40
• Net Change:  +2

Section IV – News Updates on the Wetzel’s Pretzels Franchise

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Wetzel’s Pretzels Franchise (Item 19, 2024 FDD)

• The information presented in this Item 19 pertains to Wetzel’s Pretzels Bakeries as well as Wetzel’s Pretzels Concession Trucks or Trailers. The franchisor does not provide any information that pertains to Twisted by Wetzel’s Bakeries.

• The information presented in this Item 19 excludes sales information from (a) affiliate-owned Wetzel’s Pretzels Bakeries, (b) Wetzel’s Pretzels Bakeries that were not open at the start of fiscal 2023 or that were not continuously operating under the same franchise owner throughout the 2023 fiscal year, or that did not record at least 27 weeks of sales, and (c) Wetzel’s Pretzels Bakeries that submitted late, incomplete, or illegible financial information, experienced hardware or software technical issues that inhibited proper reporting, or submitted such information in an unacceptable format.

Part 1 – 2022 Fiscal Year Adjusted Annual Gross Revenues (Wetzel’s Pretzels Bakeries)

All Franchised Wetzel’s Pretzels Bakeries

• Sample Size:  243
• Average Adjusted Gross Revenues:  $871,649
• Percentage of Wetzel’s Pretzels Bakeries at or Above Average:  39%
• Number of Wetzel’s Pretzels Bakeries at or Above Average:  95
• Highest Adjusted Gross Revenues:  $2,550,874
• Median Adjusted Gross Revenues:  $787,619
• Lowest Adjusted Gross Revenues:  $80,835
• Average Number of Weeks with Sales in FY 2023 (out of 52 weeks):  51.3

Wetzel’s Pretzels Bakeries in Entertainment Center Locations

• Sample Size:  10
• Average Adjusted Gross Revenues:  $1,004,096
• Percentage of Wetzel’s Pretzels Bakeries at or Above Average:  50%
• Number of Wetzel’s Pretzels Bakeries at or Above Average:  5
• Highest Adjusted Gross Revenues:  $1,892,471
• Median Adjusted Gross Revenues:  $885,112
• Lowest Adjusted Gross Revenues:  $359,710
• Average Number of Weeks with Sales in FY 2023 (out of 52 weeks):  47.2

Wetzel’s Pretzels Bakeries in Outlet Malls

• Sample Size:  32
• Average Adjusted Gross Revenues:  $1,066,886
• Percentage of Wetzel’s Pretzels Bakeries at or Above Average:  38%
• Number of Wetzel’s Pretzels Bakeries at or Above Average:  12
• Highest Adjusted Gross Revenues:  $2,459,967
• Median Adjusted Gross Revenues:  $885,107
• Lowest Adjusted Gross Revenues:  $226,411
• Average Number of Weeks with Sales in FY 2023 (out of 52 weeks):  51.9

Wetzel’s Pretzels Bakeries in Regional Malls

• Sample Size:  159
• Average Adjusted Gross Revenues:  $915,662
• Percentage of Wetzel’s Pretzels Bakeries at or Above Average:  40%
• Number of Wetzel’s Pretzels Bakeries at or Above Average:  64
• Highest Adjusted Gross Revenues:  $2,550,874
• Median Adjusted Gross Revenues:  $820,994
• Lowest Adjusted Gross Revenues:  $279,069
• Average Number of Weeks with Sales in FY 2023 (out of 52 weeks):  51.8

Wetzel’s Pretzels Bakeries in Non-Traditional Outlets/Transit Locations

• Sample Size:  16
• Average Adjusted Gross Revenues:  $642,629
• Percentage of Wetzel’s Pretzels Bakeries at or Above Average:  31%
• Number of Wetzel’s Pretzels Bakeries at or Above Average:  5
• Highest Adjusted Gross Revenues:  $1,866,388
• Median Adjusted Gross Revenues:  $423,863
• Lowest Adjusted Gross Revenues:  $80,835
• Average Number of Weeks with Sales in FY 2023 (out of 52 weeks):  51.4

Wetzel’s Pretzels Bakeries in Walmart Store Locations

• Sample Size:  18
• Average Adjusted Gross Revenues:  $541,165
• Percentage of Wetzel’s Pretzels Bakeries at or Above Average:  56%
• Number of Wetzel’s Pretzels Bakeries at or Above Average:  10
• Highest Adjusted Gross Revenues:  $1,039,705
• Median Adjusted Gross Revenues:  $551,601
• Lowest Adjusted Gross Revenues:  $207,492
• Average Number of Weeks with Sales in FY 2023 (out of 52 weeks):  51.6

Wetzel’s Pretzels Bakeries in Concession Trucks/Trailers

• Sample Size:  8
• Average Adjusted Gross Revenues:  $252,011
• Percentage of Wetzel’s Pretzels Bakeries at or Above Average:  50%
• Number of Wetzel’s Pretzels Bakeries at or Above Average:  4
• Highest Adjusted Gross Revenues:  $376,187
• Median Adjusted Gross Revenues:  $260,888
• Lowest Adjusted Gross Revenues:  $126,694
• Average Number of Weeks with Sales in FY 2023 (out of 52 weeks):  43.3

• The chart above reflects the Adjusted Gross Revenues for Wetzel’s Pretzels Bakeries. The chart does not reflect net income or profits and does not include costs or expenses that you will incur in operating your Wetzel’s Pretzels Bakery.

• For those franchisees who operate a Remote Mobile Unit in connection with their Wetzel’s Pretzels Bakery, the total Adjusted Gross Revenue from the operation of the Remote Mobile Unit and the Wetzel’s Pretzels Bakery is reported together because it is not possible to separate out the Adjusted Gross Revenue from sales made at the Wetzel’s Pretzels Bakery from those made at a Remote Mobile Unit.

• All food items are prepared at the Bakery and delivered to the Remote Mobile Unit for sale within the same mall. A Remote Mobile Unit gives a franchisee an opportunity to make sales from another location within the same mall. Your total Adjusted Gross Revenue may depend on whether you operate a Remote Mobile Unit in addition to your Wetzel’s Pretzels Bakery.

• Of the 191 Wetzel’s Pretzels Bakeries located in Regional Malls and Outlet Malls that were open for 12 months ended November 30, 2023, 158 Wetzel’s Pretzels Bakeries operate without a Remote Mobile Unit and 33 Wetzel’s Pretzels Bakeries operate with a Remote Mobile Unit.

• The 158 Wetzel’s Pretzels Bakeries that operate without a Remote Mobile Unit achieve Average Adjusted Gross Revenues of $832,552 and a Median Adjusted Gross Revenues of $794,625. 44.3% of the Wetzel’s Pretzels Bakeries that operate without a Remote Mobile Unit achieve Average Adjusted Gross Revenues in excess of $832,552. 51.5% of the Wetzel’s Pretzels Bakeries that operate without a Remote Mobile Unit achieve Median Adjusted Gross Revenues in excess of $794,625.

• The 33 Wetzel’s Pretzels Bakeries that operate with a Remote Mobile Unit achieve Average Adjusted Gross Revenues of $1,460,224 and a Median Adjusted Gross Revenues of $1,524,517. 51.5% of Wetzel’s Pretzels Bakeries that operate with a Remote Mobile Unit achieve Average Adjusted Gross Revenues in excess of $1,460,224. 48.5% of Wetzel’s Pretzels Bakeries that operate with a Remote Mobile Unit achieve Median Adjusted Gross Revenues in excess of $1,524,517.

• The above chart includes 243 Wetzel’s Pretzels Bakeries that were open for 12 months ended November 30, 2023, and recorded sales for a majority (27 or more) of the 52 weeks of the fiscal year ending November 30, 2023. Of the 243 Wetzel’s Pretzels Bakeries, 26 were in Arizona, 127 in California, 1 in Colorado, 2 in Connecticut, 2 in Florida, 1 in Georgia, 1 in Iowa, 4 in Idaho, 8 in Illinois, 3 in Indiana, 3 in Maryland, 3 in Massachusetts, 2 in Michigan, 2 in Minnesota, 1 in Missouri, 4 in Nevada, 10 in New Jersey, 7 in New York, 5 in Oregon, 1 in Pennsylvania, 7 in Puerto Rico, 1 in Tennessee, 16 in Texas, 1 in Utah, and 5 in Washington. The franchises are substantially similar to those being offered in this disclosure document.

• The figures for franchised Wetzel’s Pretzels Bakeries were provided to Wetzel’s Pretzels by franchisees. In all cases, the Adjusted Gross Revenue figures have been used by Wetzel’s Pretzels as the basis for collecting Royalties and calculating the Advertising Fund Contribution. In many instances, Wetzel’s Pretzels has not audited these figures, nor has it independently confirmed their accuracy.

• For purposes of Part 1, the following terms have the following definitions:

• Entertainment Center Locations: An Entertainment Center Location is a place where people congregate to be entertained by performances or amusement, including but not limited to movie theatres, sports arenas, casinos, amusement parks, and theme parks.

• Outlet Malls: Outlet Malls are typically a large group of shops, “outlet shops,” or “factory shops” usually located outside of a town or city in which the shop sells products and services at discounted prices. Store format and expense structure is very similar to Regional Malls.

• Regional Malls: For purposes of Part 1, the term Regional Malls means all types of malls other than Outlet Malls.

• Non-Traditional Outlets: Includes non-traditional transit locations (such as airports, railroad stations, train stations, and other similar locations intended for other modes of transportation), travel plazas, convenience stores, and military installations.

• Concessions Truck/Trailer: Wetzel’s-branded mobile concessions trucks or trailers that have a full bakery operation and are assigned a specific mobile area in which to sell. Sales may take place via roadside parking, events, fairs, catering, etc.

• Each of the Wetzel’s Pretzels Bakeries used in compiling the figures in Part 1 above had been in operation for at least 12 months. In most cases, financial performance, revenues, and overall results for Wetzel’s Pretzels Bakeries are materially less favorable during a Wetzel’s Pretzels Bakery’s first 12 months of operation.

• The last row in the table titled “Average Number of Weeks with Sales in FY 2023 (out of 52 weeks)” identifies the average number of weeks during fiscal year 2023 during which sales were recorded. Some formats, particularly Wetzel’s Pretzels Concession Trucks or Trailers, tend not to be open and operating every week of the year for reasons that include vacation time, weather, and truck repair.

Part 2 – 2023 Fiscal Year Adjusted Annual Gross Revenues for Regional Malls and Outlet Malls (Wetzel’s Pretzels Bakeries Only)

• Because, as of November 30, 2023, 79% of Wetzel’s Pretzels franchisees operate a Wetzel’s Pretzels Bakery within a Regional Mall or Outlet Mall, Wetzel’s Pretzels has provided a further breakdown of the Adjusted Gross Revenues for those Wetzel’s Pretzels Bakeries that are operated in Regional Malls or Outlet Malls.

Adjusted Annual Gross Revenues Range

• $700,000 and Up:  126 Wetzel’s Pretzels Bakery Franchises
• $550,000 to $699,999.99:  27 Wetzel’s Pretzels Bakery Franchises
• $400,000 to $549,999.99:  22 Wetzel’s Pretzels Bakery Franchises
• $250,000 to $399,999.99:  15 Wetzel’s Pretzels Bakery Franchises
• Up to $249,999.99:  1 Wetzel’s Pretzels Bakery Franchise

Part 3 – Adjusted Gross Revenues, Costs of Goods Sold, and Operating Expenses for 2022 (Wetzel’s Pretzels Regional Mall and Outlet Mall Bakeries Only)

Net Sales:  $956,895 (100.0%)

Costs of Goods Sold:  $199,287 (20.8%)

Gross Profit:  $757,609 (79.2%)

Operating Expenses

• Labor:  $254,569 (26.6%)
• Rent:  $146,117 (15.3%)
• Other Expenses:  $143,534 (15.0%)
• Total Expenses:  $544,220 (56.9%)

Net Operating Income:  $213,388 (22.3%)

• This section is based on the unaudited sales and operating costs reported for 200 franchised regional mall or outlet mall stores that were open and operating for the full 2022 calendar year, and for which the franchisee submitted profit and loss statements in the appropriate format for this period (“Benchmark Stores”).

• Although Wetzel’s Pretzels has no information or basis to believe the data regarding Benchmark Stores is inaccurate, it has relied on the data reported by franchisees and has not formally audited it. Wetzel’s Pretzels is pursuing initiatives to automate profit and loss reporting with the goal of further increasing the amount and accuracy of the available data.

• As franchised stores have approximately 120 days to submit year-end financial statements, 2023 sales and operating costs are not currently available.

• Though the numbers appear to accurately reflect the level of results expected, there is no guarantee that they are in whole or part correct.

• Cost of Goods Sold (sometimes referred to as COGS) is a figure which reflects the cost of materials used to produce the products you sell to your customers. It includes the cost of food ingredients (pretzel mix, butter, beverages, etc.), paper products (cups, napkins, bags, straws, etc.), and retail items.

• Gross Profit is the Adjusted Gross Revenue minus Cost of Goods Sold.

• Operating Expenses are the day-to-day costs incurred in conducting normal business operations

• Labor includes wages paid to your employees and payroll taxes paid for your employees. Labor does not include actual wages and related expenses you pay to yourself.

• Rent includes the base rent for your lease including extra charges, such as common area maintenance (CAM) charges, real estate taxes, percentage rents, etc.

• Other Expenses include such things as utilities (electric, telephone), royalties, ad fund fees, advertising, insurance (Workers’ Comp, property, casualty, liability, health, etc.), licenses, permits, repairs, uniforms, store supplies, etc.

• Total Expenses is the total of Labor, Rent, and Other Expenses.

• Net Operating Income is Gross Profit minus Total Expenses.

• Some Wetzel’s Pretzels Bakeries have sold this amount. Your individual results may differ. There is no assurance that you will sell as much.

Section VI – Wetzel’s Pretzels Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️