Bubble tea, or boba tea, is a popular beverage that originated in Taiwan. It usually includes tea, milk, tapioca balls, and sometimes other toppings. There are several franchises available in the U.S. for entrepreneurs interested in building a business around this beverage. Here are a few to consider.
What is a bubble tea franchise?
A bubble tea franchise is an independently owned business that sells bubble tea, but uses a franchise model. This means the larger brand is owned by a corporation, but the individual store is owned by a local franchisee. The franchisee pays a fee and royalty for the ability to use the brand’s business systems.
Why You Should Consider a Bubble Tea Franchise
If you’re interested in starting a business in 2023, here are some reasons to consider a franchise bubble tea shop:
Stand out in a crowded beverage industry: Bubble tea is a unique offering in many U.S. cities. Though lots of these businesses also offer other specialty beverages like coffees and teas, a bubble tea shop is likely to get noticed.
Build brand recognition: Thanks to having franchises in other markets around the country, some people are likely to already know of major bubble tea brands. So you shouldn’t have to work as hard to build trust and recognition.
Get up and running quickly: Franchises offer proven systems and support with tasks like site selection and training. So you don’t have to figure these elements out on your own.
Access to proven business systems: Once you’ve launched, they also provide support with marketing materials, inventory, and equipment purchases.
Expand your offerings: Bubble tea shops often provide additional food and beverage options as well. So this may be the ideal way to break into the beverage world with a small shop.
Top Bubble Tea Franchises
If you’re ready to start a bubble tea business, there are plenty of brands offering new franchise locations around the U.S. Here are some top bubble tea franchise opportunities to consider.
1. Kung Fu Tea
Kung Fu Tea is a popular brand with more than 2002 stores around the U.S. The company offers a ten-step process for getting your own bubble tea shop off the ground. And they offer multiple store models, from traditional storefronts to those located in airports and shopping centers. Upfront costs range from $140,000 to $422,000 for a traditional store.
2. Tapioca Express
Tapioca Express currently has about 29 franchise locations in the U.S., mainly along the West Coast. The company provides a wide array of startup support services, from location selection to employee training. Getting started costs anywhere from about $200,000 to $527,000.
3. Gong Cha
Gong Cha is a bubble tea franchise that originally launched in Taiwan. Stores offer fresh tea sourced from Taiwan and tapioca pearls made from the finest ingredients. The company is currently seeking new franchisees in a number of states, mainly in the Northeast. Estimated startup costs range from $177,430 to $335,400 for a single unit.
Bubbleology is a small franchise business that offers boba, waffles, and various fruit-flavored milk teas. The brand looks for experienced retail operators to develop exclusive territories across the U.S. The company only has a few locations currently, so there are many open territories available, with estimated upfront costs falling between $205,850 and $458,950.
Sharetea offers a variety of beverages, including traditional tea, milk tea, blended drinks, and fruit juices. The company originally launched in 1992 and has more than 150 stores across North America. Startup costs vary, starting around $300,000.
6. Koi Tea
Koi Tea offers a bubble tea franchising opportunity for those with food service and/or retail experience. Each boba shop offers a variety of tea drinks as well as rolled ice cream and other treats. The initial investment ranges from about $200,000 to $500,000.
7. Ding Tea
Ding Tea is a global brand offering franchise opportunities in the U.S. The company simply requires franchisees to be at least 20 years old, have some business experience, and be passionate about the tea industry. The initial investment ranges from about $123,000 to $422,000.
8. CUPP Bubble Tea
CUPP Bubble Tea is a U.K.-based bubble tea brand. There aren’t currently any locations in the U.S. But the company offers an international master franchise program for those interested in opening the first bubble tea franchises in a new country. Costs for a new store start at £80,000. But international franchises are likely to incur extra costs since they are responsible for entire territories.
Bambu is a dessert and tea franchise offering boba tea, coffee, and exotic fruit smoothies. There are several locations spread throughout the country, but still room for growth in many markets. The initial investment falls between $137,000 and $321,000.
HTeaO originally launched in Texas in 2009. Stores focus on flavored iced teas, blended drinks, and coffee. And the initial investment ranges from $289,200 to $859,000.
How to Choose the Best Franchise to Start Your Bubble Tea Business
If you’ve decided that a bubble tea franchise is right for you, there are many businesses to consider. Here are some tips for making the best decision for your goals.
Consider Your Budget
How much money do you have to dedicate to a franchise fee and other upfront costs? Many companies also require new franchisees to have a certain net worth to meet ongoing costs until the store becomes profitable.
Research Your Local Market
What bubble tea businesses already have a location in your area? If you can offer something new, your franchise may be more likely to stand out. Additionally, if you’re interested in eventually expanding with a multi-unit development, consider a brand with lots of open territory near you.
Look at the Support Systems
Each franchise system offers different types of support, from marketing to helping design store layouts. Think about the elements of operating a business that you need the most help with, and consider the opportunities that provide help in those important areas.
Dig Into the Finances
Aside from your initial investment, research ongoing expenses for each franchise, along with potential earnings. Each model should provide financial data in their franchise disclosure documentation.
How much does it cost to start a boba tea franchise?
Each boba tea franchise has its own costs, which also vary by location. However, most brands estimate the initial investment to fall between $200,000 and $500,000. You probably won’t find many bubble tea shops when searching for franchises under 10k or even franchises under 20k. A few franchises offering a kiosk or mobile model may fall near the range of franchises under 50k.
Is a bubble tea franchise profitable?
As is the case with nearly any industry, some bubble tea franchises are profitable, while others are not. However, this business model certainly can bring in significant income. Many franchise owners report profit margins of 20 to 30 percent. Check the list above for some of the most profitable franchises in the bubble tea industry.
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