Risk Score
Pending analysis
Investment Range
$586,599 - $1,859,492
Franchise Fee
$12,500
Total US Locations
112
Business Summary
Aroma Joe's Franchising, LLC offers a franchise business that operates full-service coffee shops and/or drive-thru kiosks. Aroma Joe's serves specialty coffee, espresso, tea, energy drinks, and other beverages, alongside pastries, donuts, muffins, and various baked food items. Customers can enjoy quick service in either a traditional coffee house setting, typically around 1,600 square feet, or through a more compact drive-thru kiosk, which is approximately 790 square feet with additional space for drive-thru lanes.
Corporate History
Aroma Joe's Franchising, LLC was formed in Florida on May 17, 2013, doing business as AROMA JOE'S, and began offering franchises in the same year. Originally established as a Delaware limited liability company, it converted to a Florida LLC on April 1, 2018. The system's origins trace back to Caffeinated Cousins, LLC, a Maine company formed in April 2000, which later reorganized as AJC Northeast, LLC in April 2018. In June 2013, Caffeinated Cousins assigned its system rights to RMB Coffee Enterprises, LLC, which then sold those rights to AJ IP Holder, LLC. On the same day, RMB formed Aroma Joe's Franchising, LLC in a joint venture with AJ Holdings, and AJ IP Holder, LLC licensed the AROMA JOE'S system to the new franchising entity.
Financial Overview
Investment Range
$586,599 - $1,859,492
Franchise Fee (Low)
$12,500
Franchise Fee (High)
$25,000
Royalty %
8%
Marketing %
3.5%
Equipment Costs (Low)
$486,849
Equipment Costs (High)
$1,305,992
Working Capital
$20,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Aroma Joe's Franchising, LLC has experienced significant financial activity. While the company saw an increase in total assets, largely due to investments in its new headquarters, its working capital, which represents the cash available for short-term expenses, decreased from over $811,000 in 2022 to approximately $342,000 in 2023. Additionally, the company's net income declined significantly, dropping from over $311,000 in 2022 to just over $41,000 in 2023. In 2023, Aroma Joe's Franchising, LLC secured a new long-term loan of over $2 million to finance improvements for its new headquarters. This loan is secured by most of the company's assets and is personally guaranteed by its members and affiliated entities. The company also engages in substantial transactions with its affiliates, including paying considerable development and licensing fees. Furthermore, Aroma Joe's Franchising, LLC guarantees a $2.4 million note payable for an affiliated entity. Despite these shifts, the independent auditors have not expressed any concerns about Aroma Joe's Franchising, LLC's ability to continue operating.
Financing Details
Aroma Joe's Franchising, LLC does not offer any direct or indirect financing to its franchisees. While the FDD mentions that franchisees might obtain financing for miscellaneous equipment through third-party lenders like Ascentium Capital and Harbour Capital, Aroma Joe's Franchising, LLC itself does not provide these loans. The availability, terms, interest rates, repayment schedules, and security requirements for such third-party financing would vary based on the franchisee's creditworthiness and the policies of these independent lenders. Aroma Joe's Franchising, LLC also explicitly states that it does not guarantee any franchisee's notes, leases, or other obligations to third parties.
Performance Metrics
Total US Locations
112
Franchised Units
112
Corporate Units
0
Franchising Since
2013
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Aroma Joe's Franchising, LLC has a clean legal record. Item 3 of its Franchise Disclosure Document explicitly states that no litigation is required to be disclosed, meaning there are no past or pending material legal actions, arbitrations, or settlements that would need to be reported to potential franchisees.
Bankruptcy History
Aroma Joe's Franchising, LLC has no bankruptcy history required to be disclosed in this Franchise Disclosure Document.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their Aroma Joe's franchise, franchisees must provide written notice to the franchisor at least six months before their agreement expires. They must be in full compliance with their existing Franchise Agreement and all other agreements with Aroma Joe's and its affiliates. Franchisees must also meet the franchisor's current qualifications and training requirements, secure continued approved facilities, and sign a general release. They will be required to sign the then-current Franchise Agreement, which may have materially different terms and conditions, including different fee requirements and territorial rights. Upon renewal, the royalty rate for Aroma Joe's franchisees will increase to 10% if they continue under their existing agreement terms, or remain at 8% if they sign the new, then-current Franchise Agreement before the initial 10-year period ends. The franchisor also reserves the right to refuse renewal if the franchisee is not in full compliance.
Training & Support Program
Franchisor Assistance
Aroma Joe's provides franchisees with initial training on establishing, marketing, and operating a coffee shop. This includes approval of the coffee shop location, assistance with lease negotiation, and providing standards and specifications for the layout, design, appearance, and equipment of the coffee shop. After opening, Aroma Joe's franchisees can consult with a representative or Development Agent for advice and guidance during normal business hours. The franchisor also offers a program of assistance with periodic consultations and written materials on new developments. Aroma Joe's administers a chainwide advertising fund, collecting weekly fees from franchisees for national and local advertising campaigns, and franchisees may also conduct local store marketing. Additionally, Aroma Joe's specifies a PC-based POS system, hardware, and software that franchisees must use, and provides basic support for these systems during normal business hours. The franchisor also requires participation in the Aroma Joe's Card Program and may mandate investments in new technology and digital initiatives.
Initial Training Hours
71
Training Location
Scarborough, Maine or virtually for classroom training; nearby Aroma Joe's Coffee Shops in Maine or another designated location for on-the-job training.
Ongoing Support
After opening, Aroma Joe's franchisees receive ongoing support through a dedicated representative or Development Agent available for advice and guidance during normal business hours. This includes periodic phone consultations and access to specified office personnel. Aroma Joe's also provides written materials detailing new developments and techniques. For marketing, Aroma Joe's administers an advertising fund, allocating contributions towards chainwide advertising activities across various media, and franchisees participate in required promotions. The franchisor also mandates the use of specific PC-based POS systems and software, offering basic support and requiring upgrades to maintain operational efficiency. Franchisees are required to accept credit and debit cards and participate in the Aroma Joe's Card Program, with potential future mandates for new technology initiatives like loyalty programs and remote ordering kiosks. Mandatory ongoing training programs, including refresher training, seminars, classes, and meetings, may be required for franchisees and their designated managers, with attendance expenses borne by the franchisee.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
retail
Owner Participation
Hands-On
Territory Type
non-exclusive
Staffing Notes
Aroma Joe's requires the franchisee, or an approved Designated Manager if the franchisee is an entity, to personally supervise the coffee shop. This individual must attend and successfully complete Aroma Joe's training program. The Designated Manager is expected to dedicate their full-time attention to managing, supervising, and operating the coffee shop, handling day-to-day tasks such as supervising employees, managing inventory, reviewing sales and food costs, and performing bookkeeping. They must ensure the coffee shop operates efficiently and adheres to Aroma Joe's specified operating hours. Aroma Joe's may also require the franchisee and/or Designated Manager to attend and successfully complete ongoing training programs, including refresher training, seminars, classes, and meetings, with the franchisee responsible for all associated expenses. Aroma Joe's does not specify typical staff counts for other employee roles.