Great Harvest Bakery Cafe Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$298,145 - $979,639
Franchise Fee
$31,500
Total US Locations
158
Business Summary
Great Harvest operates a high-quality bakery cafe that features fresh-baked whole wheat bread, baked goods, soups, salads, sandwiches, and related menu items. The business bakes bread on-site and also sells fresh baked breads to wholesale and mail-order accounts locally according to its specifications. The Great Harvest brand is distinguished by its proprietary recipes, unique fixtures, furnishings, decor, and specific operations methods, sales techniques, management control procedures, training, and advertising programs.
Corporate History
Great Harvest Franchising, LLC was originally formed as a corporation in Montana on May 1, 1980, and later converted to a Delaware limited liability company on September 10, 2024. The company began offering franchises on November 1, 1980. Prior to March 2017, Great Harvest offered franchises for fresh-milled bread bakery outlets with limited menu options. Since March 2017, it has exclusively offered franchises to operate full Great Harvest Bakery Cafes with extensive menus and seating. While Great Harvest Franchising, LLC periodically owned and operated its own Great Harvest outlets since 1999, as of the FDD issuance date, it no longer owns any. It currently operates a research and development test lab and training facility in Dillon, Montana. Great Harvest Holdings, LLC is the franchisor's parent company, which is itself controlled by New Spring Franchise Capital II, L.P. and GH Legacy Holdings, Inc. New Spring Franchise Capital II, L.P. has several affiliates that franchise other brands, including Blo Blow Dry Bar, Duck Donuts, Central Bark, Federal Donuts, and Green Home Solutions.
Financial Overview
Investment Range
$298,145 - $979,639
Franchise Fee (Low)
$31,500
Franchise Fee (High)
$35,000
Royalty %
5%
Marketing %
3.5%
Equipment Costs (Low)
$200,221
Equipment Costs (High)
$820,083
Working Capital
$36,898
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
The FDD highlights Great Harvest Franchising, LLC's financial condition as a special risk, stating that it 'calls into question the franchisor's financial ability to provide services and support' to franchisees. As of October 31, 2024, Great Harvest Franchising, LLC's consolidated balance sheet shows total liabilities of $6,209,855 compared to total assets of $2,178,040, resulting in a member's deficit of $(4,031,815).
Financing Details
Great Harvest Franchising, LLC does not offer any direct or indirect financing options. Great Harvest Franchising, LLC also does not guarantee any notes, leases, or other financial obligations on behalf of its franchisees.
Performance Metrics
Total US Locations
158
Franchised Units
158
Corporate Units
0
Avg Square Footage
2,100
Franchising Since
1980
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
3
Litigation Summary
Great Harvest Franchising, LLC has been involved in three litigation cases. In 2022, Great Harvest Franchising, LLC filed a lawsuit against a former franchisee in Montana for breach of contract and breach of good faith regarding money owed. This case was settled in 2023 with Great Harvest Franchising, LLC paying the former franchisee $17,000, and the case was dismissed. In 2024, Great Harvest Franchising, LLC filed a complaint against former franchisees for violating trademark, trade secret, and contract terms by continuing to operate a bakery cafe with their trademarks and proprietary information after their agreement expired. A temporary restraining order was granted, and the parties settled, with the former franchisees agreeing to pay outstanding gift card liability and a note, and consenting to a permanent restraining order. Additionally, an affiliate, Duck Donuts Holdings, LLC, entered into a Consent Order with the California Department of Financial Protection and Innovation in 2022. The claims alleged that Duck Donuts violated California Franchise Investment Law by using Google click ads and offering a franchise when its disclosure document was not registered in the state. Duck Donuts Holdings, LLC voluntarily agreed to comply with the law and pay a $5,000 penalty.
Bankruptcy History
Great Harvest Franchising, LLC has no bankruptcy history to report.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew, Great Harvest Franchising, LLC franchisees must provide written notice at least six months before the current term ends. They must be in full compliance with the franchise agreement, having committed no more than three defaults during the current term. Franchisees are required to complete any additional training, ensure they have the right to continue occupying their business premises (or obtain approval to relocate), repair, upgrade, or replace equipment to meet current specifications, execute a general release of claims against Great Harvest Franchising, LLC, and sign a new franchise agreement. They must also pay a successor agreement fee.
Training & Support Program
Franchisor Assistance
Great Harvest Franchising, LLC provides franchisees with comprehensive support both before and after opening. Before opening, Great Harvest Franchising, LLC assists with site search, provides site selection guidelines, and approves the chosen location, architect, and contractor. It offers detailed specifications for the bakery's layout, design, appearance, and signage, and may inspect construction progress. Franchisees receive the Great Harvest Operations Manual, a list of necessary equipment and supplies, initial training, and approval for their grand opening marketing plan. After opening, Great Harvest Franchising, LLC offers mandatory or optional additional training programs, including annual business meetings or conventions for a fee plus expenses. It provides on-site remedial training upon request (for a fee plus expenses) and individualized assistance via telephone, video conferencing, or email. Great Harvest Franchising, LLC also supplies samples of advertising materials, conducts inspections to ensure quality standards, provides updated lists of approved suppliers, and may set advertised or maximum product prices. The franchisor approves all local advertising efforts and administers the system-wide Brand Fund.
Initial Training Hours
343
Training Location
Dillon, Montana
Ongoing Support
After opening, Great Harvest Franchising, LLC offers ongoing support including mandatory or optional additional training programs, which can last up to 5 days per year, and an annual national business meeting or system-wide franchisee convention, up to 3 days per year. Franchisees can request remedial on-premises training and individualized assistance by telephone, video conferencing, or email, though fees and expenses may apply for on-site training. Great Harvest Franchising, LLC also provides samples of advertising materials, conducts inspections of the franchised business, and maintains updated lists of approved suppliers. They may also set advertised or maximum prices for products and services.
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
limited
Territory Size Requirements
Great Harvest Franchising, LLC territories are defined as a portion of a listed town, city, or county, identified by a marked map and/or contiguous zip codes. The size is determined individually, considering daytime and nighttime populations, minimum numbers of households or offices, and real estate prices/incomes. Typically, a territory will have a population of approximately 50,000 individuals. However, if there are less than 50,000 people within a 7.5-mile radius of the Great Harvest outlet, the territory will be defined as a 7.5-mile radius around that outlet.
Staffing Notes
Great Harvest Franchising, LLC recommends, but does not require, that the franchisee personally direct the day-to-day operation. Franchisees can appoint a non-owner general manager, who must meet the franchisor's qualifications, successfully complete initial training, and devote full time to the job without conflicting business interests. The manager and all other personnel with access to proprietary information must sign a confidentiality and non-compete agreement. All managers and employees who will handle food must have a ServSafe Food Handler or equivalent certification.