Parlor Doughnuts Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$437,000 - $808,000
Franchise Fee
$20,000
Total US Locations
63
Business Summary
Parlor Doughnuts offers franchises for craft doughnut and coffee shops. These shops provide a variety of unique bakery items, including their Famous Layered Doughnuts, along with vegan, gluten-friendly, and keto-friendly options, artisanal breakfasts, and specialty coffee. The business aims to create an upscale yet welcoming craft doughnut and coffee environment known for exceptional customer service.
Corporate History
Parlor Doughnuts, LLC, an affiliate that operates the type of business being franchised, was formed in Indiana on January 20, 2019. The franchisor entity, Parlor Doughnuts Franchising, LLC, was later formed in Indiana on January 8, 2021, specifically to offer Parlor franchises. The company and its affiliates operate craft doughnut and coffee shops, with several locations across various states.
Financial Overview
Investment Range
$437,000 - $808,000
Franchise Fee (Low)
$20,000
Franchise Fee (High)
$40,000
Royalty %
5%
Marketing %
1%
Equipment Costs (Low)
$145,000
Equipment Costs (High)
$245,000
Working Capital
$35,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Parlor Doughnuts Franchising, LLC's financial statements show a significant and increasing members' deficit, reaching over $1.2 million in 2024, compared to a deficit of approximately $435,000 in 2023. This is despite the company generating net income in both years, with a net income of $121,580 in 2024 and $29,577 in 2023. A notable factor contributing to the deficit is substantial member withdrawals, totaling over $900,000 in 2024 and $330,000 in 2023. While current assets are slightly higher than current liabilities in 2024, indicating positive working capital, the overall financial position reflects substantial accumulated losses.
Financing Details
Parlor Doughnuts Franchising, LLC does not offer any direct or indirect financing for amounts owed under the Franchise Agreement or Multi-Unit Development Agreement. The franchisor also does not guarantee any franchisee notes, leases, or other obligations. Franchisees are responsible for securing their own funding through external sources.
Performance Metrics
Total US Locations
63
Franchised Units
54
Corporate Units
9
Avg Square Footage
2,100
Franchising Since
2021
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Parlor Doughnuts Franchising, LLC has no reportable litigation history. Item 3 of the FDD states that no litigation is required to be disclosed.
Bankruptcy History
Parlor Doughnuts Franchising, LLC has no bankruptcy history to report. Item 4 of the FDD states that no bankruptcy is required to be disclosed.
Agreement Terms
Initial Term
10 years
Renewal Term
5 years
Renewal Conditions
To renew their franchise agreement, Parlor Doughnuts franchisees must provide written notice of their intent to renew between 6 and 9 months before the current agreement expires. They must be in full compliance with all terms of the Franchise Agreement and any other agreements with the franchisor or approved suppliers, and have paid all outstanding monetary obligations. Franchisees are also required to complete any additional training, make all necessary renovations and upgrades to their location to meet current standards for new franchisees, sign the franchisor's then-current standard Franchise Agreement (which may have different terms), and execute a general release of claims. Additionally, a renewal fee equal to 50% of the then-current Initial Franchise Fee is required.
Training & Support Program
Franchisor Assistance
Before opening, Parlor Doughnuts Franchising, LLC helps franchisees by approving their territory and site selection, and providing a one-page concept drawing along with brand standards for the shop's design. They also provide a list of approved suppliers and conduct a pre-opening inspection to ensure compliance. Initial training is offered to the owner (if hands-on) and up to five managers, covering food preparation, customer service, operations, and marketing. The franchisor also provides grand opening assistance for two days before and two days after the opening, and loans a Confidential Operations Manual. After opening, Parlor Doughnuts Franchising, LLC assists with developing new products and services, offering additional and ongoing training sessions, and providing general business guidance via phone, email, and newsletters. They may conduct annual post-opening inspections and manage local social media accounts on the franchisee's behalf, coordinating with the overall marketing plan and assisting with online reviews.
Initial Training Hours
180
Training Location
Franchisor headquarters (Evansville, IN), company-owned shops, franchisee's location, and virtually.
Ongoing Support
After opening their shops, Parlor Doughnuts franchisees receive various forms of ongoing support. This includes periodic development of new products and services, with a requirement to adopt mandatory new offerings. The franchisor provides additional and continuing training sessions, both in-person and online, for new or existing managers, with an additional fee and travel expenses. Annual post-opening inspections are conducted to ensure adherence to standards. The franchisor also maintains and controls social media accounts for local markets, allowing franchisees to submit content and assisting with managing online comments and reviews. Additionally, general business guidance and support are offered through telephone, email, and newsletters on operational methods, accounting, and marketing strategies.
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
full-time
Territory Type
exclusive
Territory Size Requirements
Parlor Doughnuts franchisees receive an exclusive territory. The size and boundaries of this territory are determined by factors such as community boundaries, population density, drive times, and distance from competitors and other Parlor Doughnuts locations. A typical territory for a shop considers a mileage radius, usually 3 miles, and a population of 100,000 or more.
Staffing Notes
Parlor Doughnuts states that the franchisee is solely responsible for recruiting, hiring, firing, training, and supervising employees, and determining their terms and conditions of employment. The franchisor emphasizes that employees are solely the franchisee's responsibility and are not agents of the franchisor. All employees must sign a confidentiality agreement before starting training or employment and are required to comply with system-wide policies, including dress code, non-smoking, language, and social media rules, as detailed in the Confidential Operations Manual. The initial training program for a shop manager and four department managers (kitchen, barista, hospitality, and doughnuts) is included in the initial franchise fee.