7 Leaves Cafe Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$244,000 - $490,000
Franchise Fee
$35,000
Min Cash Required
$10,000
Total US Locations
42
Business Summary
7 Leaves Cafés are quick-service establishments that offer premium coffee and tea-based drinks, along with snacks and other beverages. 7 Leaves specializes in preparing and selling distinctive quality beverages and food items, made according to proprietary recipes. These cafés operate under the 7 Leaves brand in various approved locations, including shopping plazas, stand-alone buildings, and drive-thrus, catering to customers for dine-in, drive-thru, and carry-out service.
Corporate History
The 7 Leaves Café concept began around January 2012 with an affiliate company, 7 Leaves Holding, Inc., which developed and operated 7 Leaves Cafés. 7 Leaves Franchise, LLC was registered as a California limited liability company on July 6, 2017, specifically to begin offering franchises for the quick-service coffee and tea-based drink cafés under the 7 Leaves brand. The franchisor has not offered franchises in any other line of business.
Financial Overview
Investment Range
$244,000 - $490,000
Franchise Fee (Low)
$35,000
Franchise Fee (High)
$35,000
Minimum Cash Required
$10,000
Royalty %
6%
Marketing %
2%
Equipment Costs (Low)
$161,000
Equipment Costs (High)
$335,000
Working Capital
$20,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
7 Leaves Franchise, LLC appears to be in a strong financial position, reporting a net income of $613,597 for the year ended December 31, 2023. The company also demonstrated strong liquidity with over $723,000 in working capital and generated $347,072 in net cash from operating activities in 2023, ending the year with $883,064 in cash and cash equivalents. The auditors did not express any substantial doubt about 7 Leaves Franchise, LLC's ability to continue as a going concern.
Financing Details
7 Leaves Franchise, LLC does not offer any direct or indirect financing to franchisees, nor does it guarantee any notes, leases, or obligations for them. Franchisees are responsible for securing their own funding.
Performance Metrics
Total US Locations
42
Franchised Units
14
Corporate Units
28
Avg Square Footage
1,700
Franchising Since
2017
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
7 Leaves Franchise, LLC has no litigation history to report.
Bankruptcy History
7 Leaves Franchise, LLC has no bankruptcy history to report.
Agreement Terms
Initial Term
5 years
Renewal Term
5 years
Renewal Conditions
To renew their 7 Leaves Cafe franchise agreement, franchisees must have substantially complied with their current agreement, pay a renewal fee equal to half of the then-current initial franchise fee, and may be required to remodel their café at their own expense to meet current brand standards. They will also need to sign the franchisor's then-current franchise agreement, which could include terms and conditions that are materially different from their original agreement.
Training & Support Program
Franchisor Assistance
7 Leaves Franchise, LLC provides a range of support to its franchisees. Before opening, 7 Leaves assists with reviewing site plans and providing design layouts, offers advice on site selection based on demographics and traffic, and provides sample content for grand opening and local advertising campaigns, along with specifications for equipment, signs, and fixtures. Franchisees also receive an operations manual and cloud-based access to video training materials and forms. Initial training covers various aspects including 7 Leaves culture, site selection, hiring, drink preparation, cashier duties, marketing, inventory, and POS systems. Ongoing support includes advisory relationships with telephone consultations, periodic store inspections, and evaluations to ensure system standards are met. 7 Leaves also manages a system-wide advertising and marketing fund and controls the brand's online presence, including social media.
Initial Training Hours
156
Training Location
The initial training for 7 Leaves Culture and Café Site Selection, as well as the Hands-On Training, takes place at 7 Leaves Franchise, LLC's Corporate Training Facilities in Huntington Beach, California, or at participating 7 Leaves Cafés located nearby. Additionally, Calibration Training is conducted on-site at the franchisee's own café.
Ongoing Support
After opening, 7 Leaves Franchise, LLC provides ongoing support to its franchisees through an advisory relationship that includes telephone consultations to help with effective operation. The franchisor or its agents also visit and inspect the franchisee's store periodically to evaluate system execution and confer with the franchisee and their employees. 7 Leaves Franchise, LLC may also require franchisees or their management team to attend additional training or refresher courses. Furthermore, the franchisor controls and provides branded social media pages and assets, and may conduct collective marketing campaigns on behalf of franchisees via local social media.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Supervisory
Territory Type
Non-Exclusive
Staffing Notes
7 Leaves Cafe requires that the franchised business be directly supervised on-premises by a manager who has successfully completed the franchisor's training program. This manager must not have any interest or business relationship with competing businesses and does not need to be an owner of the franchise entity. Franchisees are responsible for hiring and training their own employees, and the franchisor may consider factors like staff turnover when determining the need for pre-opening assistance.