Big Apple Bagels Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$306,500 - $685,000
Franchise Fee
$10,000
Total US Locations
49
Business Summary
Big Apple Bagels franchisees operate retail stores specializing in bagels, cream cheese spreads, muffins, breakfast and lunch sandwiches, and coffee beverages. These stores can be either Production Stores, which handle on-site baking and distribution, or Satellite Stores, which are supplied by a Production Store. The business operates under the trademarks Big Apple Bagels, My Favorite Muffin, and Brewster's.
Corporate History
Big Apple Bagels, or BAB Systems, Inc., was established in December 1992 as an Illinois corporation. The company began offering Big Apple Bagels franchises on March 30, 1993, and My Favorite Muffin franchises since 1998. Initially, both brands were offered under a single franchise disclosure document until September 2018, when Big Apple Bagels created separate disclosure documents for each brand. Big Apple Bagels also developed 'SweetDuet Frozen Yogurt & Gourmet Muffins,' which was offered as a stand-alone concept from May 2012, then as a Dual-Concept in December 2014, and was eventually discontinued for Big Apple Bagels Stores in January 2016, though existing franchisees can still sell SweetDuet products if their stores are equipped. The company's parent is BAB, Inc., which owns the trademarks and earns revenue from franchisees' purchases of certain products. BAB Operations, Inc., another affiliate, was created in 1995 to run company-owned stores, but currently does not operate any Big Apple Bagels or My Favorite Muffin locations.
Financial Overview
Investment Range
$306,500 - $685,000
Franchise Fee (Low)
$10,000
Franchise Fee (High)
$25,000
Royalty %
5%
Marketing %
3%
Equipment Costs (Low)
$259,000
Equipment Costs (High)
$574,000
Working Capital
$11,500
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Big Apple Bagels has received an unqualified audit opinion for its financial statements for the years ended November 30, 2024, 2023, and 2022, with no substantial doubt raised about its ability to continue as a going concern. The financial statements indicate that the balances owed to Big Apple Bagels by its parent (BAB, Inc.) and affiliate (BAB Operations, Inc.) are classified as contra-equity accounts, as funds in these entities are noted as limited. In fiscal year 2024, the company recorded a minor loss of approximately $11,700 from an equipment lease termination. Management believes no goodwill impairment exists as of November 30, 2024.
Financing Details
Big Apple Bagels does not offer any direct or indirect financing to its franchisees. Franchisees are responsible for securing their own funding, and Big Apple Bagels will not guarantee any notes, leases, or other obligations.
Performance Metrics
Total US Locations
49
Franchised Units
49
Corporate Units
0
Franchising Since
1993
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Big Apple Bagels has no litigation history that is required to be disclosed in the FDD. There are no pending, resolved, or ongoing legal cases or disputes involving the franchisor or its management.
Bankruptcy History
Big Apple Bagels has no bankruptcy history that is required to be disclosed in the FDD. There are no bankruptcy proceedings involving the franchisor, its predecessors, parents, affiliates, or any key management personnel to report.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their franchise, Big Apple Bagels franchisees must provide written notice between 6 and 12 months before the current term ends. They must be in good standing, having substantially complied with all terms of their agreement and met operating and quality standards. All monetary obligations to Big Apple Bagels, its affiliates, and designated suppliers must be satisfied. Franchisees are required to upgrade their store to Big Apple Bagels' then-current standards for decor, equipment, and product offerings, pay a renewal fee of $2,500, comply with current qualification and training requirements, and sign a general release of any claims against Big Apple Bagels and its affiliates.
Training & Support Program
Franchisor Assistance
Big Apple Bagels provides comprehensive support to its franchisees. Before opening, the franchisor assists with site selection (though the franchisee is responsible for finding the site), provides basic store drawings and specifications, loans the Operations Manual, and guides franchisees on purchasing approved equipment, signs, fixtures, inventory, and supplies, including POS system requirements. After opening, Big Apple Bagels offers additional on-site training near the store opening, provides updates to the Operations Manual, and offers ongoing guidance on operating procedures, purchasing, food preparation methods, and administrative and management procedures. Big Apple Bagels also defends franchisees for proper use of its trademarks, may conduct market research and product testing, administers a Marketing Fund for promotional programs, reviews local advertising, evaluates potential transferees, and provides suggested retail pricing.
Initial Training Hours
144
Training Location
Big Apple Bagels' corporate offices in Deerfield, Illinois, via telecommunication platforms like Zoom, or at a designated operational franchise store and later at the franchisee's own new store.
Ongoing Support
After opening, Big Apple Bagels franchisees receive additional operational training at their store. They are provided with an updated Operations Manual that reflects changes in standards and procedures. Big Apple Bagels offers continuous guidance on specifications, operating procedures, approved purchasing, food preparation, and administrative, bookkeeping, accounting, and general management. This support is delivered through the Operations Manual, intranet, bulletins, written reports, and consultations by phone or in person. The franchisor also conducts market research and product testing, reviews local advertising materials, and administers a Marketing Fund for promotional activities. Big Apple Bagels also reviews raw ingredient costs to provide suggested retail pricing.
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
Territory Size Requirements
Big Apple Bagels franchisees operating a single store do not receive an exclusive territory and may face competition from other franchised or company-owned outlets, or alternative distribution channels controlled by Big Apple Bagels. The franchise is granted for a specific location only, with no minimum territory size granted. For Big Apple Bagels Area Developers, an exclusive Protected Development Area is granted, provided they comply with their development obligations. The size of this Protected Development Area varies based on market potential and the Developer's financial and operational capabilities. It may encompass one or more counties in rural areas or a portion of a metropolitan statistical area in heavily populated major cities. The Protected Development Area is not defined by a minimum population. If a Developer fails to meet their development obligations, they lose the right to open additional stores and lose exclusivity in the designated area.
Staffing Notes
Big Apple Bagels requires that each store be directly supervised by a manager who has successfully completed the franchisor's training program. This on-premises manager must not have any conflicting business relationships. The franchisee is solely responsible for all aspects of employee management, including hiring, firing, scheduling, compensation, and training of all staff. Employees must maintain a neat and clean appearance and adhere to Big Apple Bagels' uniform requirements. Employment applications must clearly state that the franchisee, not Big Apple Bagels, is the employer. The franchisor reserves the right to appoint a manager for the store if it is not properly managed by the franchisee or a qualified manager, with associated fees.