Auntie Annes Franchise Kit

8/10/2019 Auntie Annes Franchise Kit

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Franchising with Auntie Anne’s ®



If you have ever experienced the perfection of an Auntie Anne’s® pretzel, you already know that having one of these

rewarding treats will create the craving for another. One taste…and you knew that you were hooked. You are not

alone, as thousands of people in over 30 countries have happily faced that same realizat ion.

Either your taste buds or our reputation have led you to this moment. You are reading this now because you have

a strong interest in learning more about our award-winning brand, our system for creating “Pretzel Perfection”,

and what it takes to join our franchise family. This Franchise Kit will provide you with an overview of the initial

information needed as you continue your research on becoming a franchise partner with Auntie Anne’s.

Over the past 25 years, Auntie Anne’s has grown to have a presence in a variety of venues through the construct ion

of multiple types of store layouts. Our commitment to creating and operating diverse, exible designs is evident

in not only our agship and full-sized locations, but in our smaller baking kiosks as well. To accomplish this

successfully, we have assembled an international team of industry veterans who specialize in operations, marketing,

store development, training and much more. When you join the Auntie Anne’s fami ly, you will be working with

experienced professionals with extensive experience in every facet of the foodserv ice and franchise industries.

At Auntie Anne’s, we are committed to the success of our f ranchise partners, with a focus on providing world-class

support and service, with an emphasis on cultivat ing relationships through mutual respect and trust. As part of

FOCUS Brands, a multi-brand organizat ion based in Atlanta, Georgia, we wi ll continue to create new and exciting

Auntie Anne’s opportunities for our existing and future f ranchise partners in the years to come.

Thank you for your interest and we look forward to hearing f rom you soon!

Are You Hooked ?



The legendary story of the pretzel features an Italian monk who had decided to reward his students by serving

them baked scraps of leftover dough. He rolled and twisted t he dough to resemble his students, who folded their

arms across their chests when praying. After baking the dough to a golden brown, he called the nished product

“pretiolas,” Latin for “little rewards”.

At Auntie Anne’s, we roll, twist and bake our soft pretzel products in full v iew of guests. Our proven line-up of core

pretzel products includes the Original, Cinnamon Sugar and Almond avors, as well as Stix, Nuggets and our Pretzel

Dog. Additional avors include Pepperoni, Garlic, Raisin, Sesame, Sour Cream & Onion and Jalapeño. Do you like

to dip your pretzel? Pretzel dipping sauces are offered in a wide variety of avors and play an important part of the

Auntie Anne’s menu. When paired with one of our ref reshing beverages, especia lly Auntie Anne’s famous lemonade,

these snacks and meal options are not only convenient, but portable as well for busy, active consumers.

History of the Pretzel



Anne and Jonas Beiler didn’t set out to create pretzel perfection when they purchased a

Pennsylvania farmer’s market stand in 1988. Instead, they hoped to provide free counseling

services to families and couples in their community, and purchased the stand to provide the

income that they needed to fund their vision.

After some experimentation and a few mishaps, Anne created a pretzel that customers quickly dubbed “better than the

best pretzel you have ever tasted”. It is the same pretzel we all know and love today. The popularity of “Auntie” Anne’s

pretzels was initia lly spread by word of mouth and then quickly through franchised locations. Now, 25 years later,

customers are enjoying Auntie Anne’s pretzels in more than 1,325 locations across the United States and in 25 countries!

In 2005, Sam Beiler, who started with Auntie Anne’s as a franchise partner in 1989, purchased the company from Anne

and Jonas. He took the company to new levels with his focus on innovation in all aspects of the business, from new

products, to the dedicated focus by the corporate team on providing exemplary service to our franchise partners.

Today, Auntie Anne’s continues its momentum by leveraging the multifaceted synergies and new opportunities that

result from having become a part of the FOCUS Brands family in November of 2010. Our Executive Team actively focuses

their efforts on expanding the brand and choosing the right franchise partners and venues in which to operate, while

increasing value for all of the stakeholders. Auntie Anne’s has built its reputation on the foundation of producing only

high quality products, providing exceptional customer service, operating in att ractive and efcient stores, and promoting

the fun of pretzel making. By staying true to these principles, as well as using each day to practice the people-focused

philosophies established by our founder, our brand clearly sets itself apart from competitors.

Auntie Anne’s ® Story



Step One – Complete the Auntie Anne’s International Request for Consideration Form

Step Two – Prequalication

Once we have received a completed Request for Consideration form, we will initiate contact shortly thereafter, by

telephone or by email. At this time, we will talk about the general qualication requirements, both nancial andoperational, as well as the avai lability of the selected territory of interest.

Step Three – Formal Qualication

During this step we will examine and conrm the potential for our brand within the selected market, as well as to verify

your nancial capability. We will also work with you to achieve alignment on your preliminary business plan.

Step Four – Face-To-Face Meeting

Every international franchise partner candidate schedules a visit to our corporate support center in the United States to

meet key personnel within the International Department. An additional face to face meeting will also take place with

you within your selected market, attended by a representative from the International New Business Development team.

Step Five – Presentation of Commercial Terms

In this step in the process, we present market-specic commercial terms to you for your review and agreement.

Step Six – Presentation of the Memorandum of Understanding

Once we have received agreement of commercial terms, we prepare a formalized summary of those terms in the formof a Memorandum of Understanding (MOU) and present it to you. You will then sign the MOU and prepare payment for

10% of the agreed upon Territory Fee. After execution of the MOU, formal versions of the Territory Agreement and the

International Multi-Unit Franchise Agreement (IMUFA) are drawn up, including the specic terms of the deal from

the MOU.

Step Seven - Review and Signing of the Agreements

After your review and approval of the Territory Agreement and IMUFA, the formal agreements are then signed and

returned to us, and, at that time, the remainder of the Territory Fee is paid.

Auntie Anne’s ® International Franchise Process



FOCUS Brands International negotiates Territory Agreements ranging from a minimum of ve, to over one hundred

locations. Because of the potential range of scheduled growth and country-specic costs, nancial requirements will

vary but are commensurate with the scope of the proposed project.

As an example of the nancial capability required, for agreements that are written for the opening of only ve locations,

we expect that you will have sufcient liquid assets to nance the rst two locations completely, plus have the capital to

fund the next three locations at 50% of the overall cost.

When the number of locations increases for larger territory commitments, we will expect that your nancial resources

will be adequate to propel your operation beyond its rst three (3) years.

We expect that, aside from the funding required for the development of retail locations, you will additionally incur

expenses that are associated with building an infrastructure to support your store operations.

The Financial Requirements



Master Franchise Fee and Exclusive Territory Fee – The amount of this fee is determined by

valuating each market independently

• Ten percent (10%) of the fee is paid upon signing of the MOU

• The balance of the fee is paid upon signing of the Territory Agreement and the IMUFA

Franchise Fee – This fee is paid upon the opening of each franchised location

• USD $25,000 per location for Full-Sized Store locations

• USD $20,000 per location for Express/Kiosk locations

Royalty Rate

• Six percent (6.0%) of gross sales, payable monthly

Advertising & Marketing Fund

• One percent (1.0%) of gross sales, payable monthly

Investment on Individual Locations – The investment level required to open each individual location

will vary from country to country

Fee Structure & Individual Location Investment



The operating spirit of the relationship between Auntie Anne’s ® corporate employees and the franchise partners in

the eld is one of mutual respect and collaboration. Auntie Anne’s has a f ully-staffed support services team whose

members are dedicated solely to providing assistance and expertise to f ranchise partners in our global expansionefforts. Collectively, our international team has amassed nearly 325 years of experience in building food service

brands worldwide and currently operate from posts in more than 12 countries.

Operations

• Initiates new country launches by facilitating startups with training and operations support

• Administers advanced training programs

• Evaluates franchise operations and assists franchise partners in the development of action plans

• Provides ongoing monitoring of franchise partner growth and progression through development plans

• Acts as the primary liaison for Research & Development on product development and testing and quality controland inspections

• Requests additional services from other departments when needed by franchise partner

• Leads initiative for development of personnel to assist franchise partner companies

Supply Chain

• Ensures compliance of suppliers and distributors within the network

• Assists with distribution network relationships and negotiates distribution agreements

• Addresses issues and requests regarding products, packaging, costs, and distribution

• Conducts efforts to secure regional sources of product, as well as their distribution

• Establishes supply chain for new regional markets

International Franchise Support Services



Marketing

• Provides access to a comprehensive, high-resolution product image library

• Assists in core menu development and pricing strategies

• Assembles Local Store Marketing (LSM) toolkits

• Facilitates Research & Development projects for local product introductions

• Sales trend analysis and guidance

Development Services

• Architecture Support – Develops concept packages, assists local architects with construction plans and conducts

construction document review

• Construction Support – Assists in orienting local general contractors on brand standards, acting as a consultant

throughout the construction process

• Real Estate Support – Provides training to partners on site characteristics, reviews site evaluations and monitors

site inventories

• Furniture, Fixtures & Equipment Support – Assists in the assembly and tracking of orders and monitorsvendor relationships

• Image Support – Provides training to franchise partners on image standards and expectations

Frequently Asked Questions

Do I need previous restaurant or franchising experience to become an Auntie Anne’s® franchise partner?

While we do prefer you to have previous experience, it is not required. NOTE: Having previous experience does not

replace our Pretzel Perfection Operations Training.

Is Auntie Anne’s offering single and multi-unit opportunities?

No, Auntie Anne’s International is only seeking t hose qualied candidates who are able to open multiple

franchised locations.

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What is the initial franchise fee and royalty rate?

Initial Franchise Fee

• Full-sized location: USD $25,000 per location

• Kiosk location: USD $20,000 per location

Royalty Rate• 6.0% of Monthly gross sa les, payable monthly

How much do I have to contribute to Auntie Anne’s advertising and marketing?

You must contribute 1.0% of g ross sa les, payable monthly to t he Adverti sing and Market ing Fund

What type of training will I receive as a new Auntie Anne’s franchise partner?

New Franchise Orientat ion Program (NFOP) – A high-level program w ith a duration of two to t hree days that is

held at the FOCUS Brands corporate support center in Atlanta. This program is designed for the owners and

top executives of the new f ranchisee company.

Owners’ Training – A th ree to ve day, hands-on introduction to pretzel operations for owners and top

executives of the new franchisee company.

Pretzel Perfect ion Management Training – A comprehensive two week program that is held in Auntie Anne’s

headquarters in Lancaster, Pennsylvania. The program includes both classroom and in-store training and is

designed to prepare the operations executives a nd managers to open and successfu lly operate a store.

Grand Opening Assistance – Auntie Anne’s wi ll provide a representative to be present at the opening of your

rst two stores for up to ten working days each to assist and support the opening.

Ongoing Training – In-market training and operations support visits from our corporate staff and regional

operations team.

Does Auntie Anne’s offer nancing?

No. We do not provide nancing assistance.

How soon can I expect my Auntie Anne’s Pretzel franchise to open?

The opening of each new Auntie Anne’s Pretzel fra nchise varies based on store ty pe selected as well as location

of the new store.

Where are Auntie Anne’s franchises generally located?

You wi ll usua lly nd Aunt ie Anne’s bakeries i n heavy-traf c locations, such as high-street s, ma lls , un iversity food

courts, airports and travel plazas.

Will I have an exclusive territory?

Yes. You wi ll have a n exclusive territor y that wi ll be dened per the terms of your Territory Agreement.

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Will I receive guidance on purchasing?

Yes. We prov ide init ia l and ongoing support in supply cha in. Aunt ie Anne’s has a prefer red vendor program that

covers all aspects of opening your pretzel franchise. Additionally, we support efforts to source items locally.

Will there be any help with site development?

Yes. We prov ide assista nce and support for site select ion, layout, design, and the const ruction process.

Will I receive assistance in planning an Auntie Anne’s franchise grand opening?

Yes. Every opening receives ou r support in t raining , operations market ing and public relat ions.

• Proven Business Model

- We are the largest hand-rolled soft pretzel chain in the world.

- Auntie Anne’s is present in over 25 countries.

• Consumer Appeal

- We have a very popular product. Many people tell us, “We love your pretzels!”

- Pretzels are fresh-baked all day long. We never serve frozen products to our guests.

- Auntie Anne’s pretzels have the perception of being a “better for you” alternative compared to other

snack concepts.

• Menu

- Auntie Anne’s pretzels are convenient, fresh, portable products for on-the-go consumption.

- The Auntie Anne’s concept is adaptable to regional and local taste proles.

• Price

- Premium quality Auntie Anne’s products are available to consumers at value pricing.

• Flexible Design Layout

• A Corporate Support team to assist you every step of the way

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Why Auntie Anne’s ®?



Documents

Auntie Annes Franchise Kit