Presotea Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$193,300 - $237,800
Total US Locations
25
Business Summary
Presotea offers Master Franchises, which grant the right to subfranchise "made to order" fresh brewed tea shops called Presotea Shops. Presotea Shops specialize in fresh brewed tea beverages made with an espresso-type machine, using seasonal fresh fruits and ingredients. As a Master Franchisee, Presotea requires the subfranchising and opening of a minimum number of Presotea Shops within a protected territory and a specified timeframe. Master Franchisees are also responsible for providing training, equipment, inventory, supplies, and branded items to their subfranchisees.
Corporate History
Presotea (USA) Co., Ltd. was incorporated in Delaware on August 24, 2018, to serve as the United States franchisor for the Presotea brand and concept. Its affiliate, Presotea Co., Ltd. (Presotea Taiwan), has operated and franchised Presotea Shops internationally since 2006, establishing over 400 stores in 9 countries, including Taiwan, Indonesia, Australia, Canada, Malaysia, Singapore, Jordan, Dubai, and the United Kingdom. Presotea (USA) Co., Ltd. began offering Master Franchises in the United States in 2019. Between 2019 and 2021, it also briefly offered Area Development franchises in California, New York, and Illinois, though this offering has since ceased. Presotea (USA) Co., Ltd. does not operate or own individual Presotea Shops in the United States.
Financial Overview
Investment Range
$193,300 - $237,800
Royalty %
1.67%
Marketing %
5%
Equipment Costs (Low)
$50,000
Equipment Costs (High)
$50,000
Working Capital
$143,800
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Going concern qualification
Financial Health Notes
The independent auditors for Presotea have expressed substantial doubt about Presotea's ability to continue as a going concern, as indicated in their report. This is due to ongoing financial conditions which suggest Presotea (USA) Co., Ltd. may not have the resources to meet its obligations without further funding or generating sufficient revenue.
Financing Details
Presotea does not offer any direct or indirect financing to its Master Franchisees. It also does not guarantee any notes, leases, or other obligations for them.
Performance Metrics
Total US Locations
25
Franchised Units
25
Corporate Units
0
Franchising Since
2019
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Presotea has no litigation history to report.
Bankruptcy History
Presotea has no bankruptcy history to report.
Agreement Terms
Initial Term
6 years
Renewal Term
6 years
Renewal Conditions
To renew their Master Franchise Agreement, Presotea Master Franchisees must be in good standing and not be in default. They need to provide 12 months' written notice of their intent to renew before the current term expires. Renewal requires signing a new Master Franchise Agreement, which may have different material terms, including territorial boundaries, economic terms, royalties, or new mandatory expenses. Master Franchisees must also pay a renewal fee equal to 50% of the then-current Master Franchise fee for their territory (if applicable, or on other negotiated terms). Additionally, all required Presotea Shops must have been sold and opened by the renewal date, and all existing Presotea Shops under their control must have been remodeled, refurbished, and modernized to current system standards. Finally, Master Franchisees must execute a general release.
Training & Support Program
Franchisor Assistance
Presotea provides Master Franchisees with various forms of assistance. Before they begin selling Presotea Shops, Presotea licenses the use of its Marks and System, designates the territory, and provides lists for required kitchen equipment, initial opening product inventory, branded items, and leasehold improvement guidelines. Master Franchisees also receive suggested pricing guidelines upon request and access to a confidential Operations Manual. Initial training for at least three individuals is provided by Presotea Taiwan. After Master Franchisees begin selling Presotea Shops, Presotea protects the Marks and System, provides periodic updates to the Operations Manual, and shares ongoing lists of new menu items, recipes, suggested pricing, and approved vendors. Presotea offers periodic training programs for managers and employees, as well as consultation and advice. Additionally, Master Franchisees can request specific additional training onsite for a daily fee plus travel costs. Presotea maintains the www.presotea.com website and will manage the Network Marketing Program and Brand Fund Fees once implemented. Presotea also provides ongoing branded products and inventory as purchased by Master Franchisees for their subfranchisees, and offers additional services through its affiliate Presotea Taiwan upon request. Presotea also approves all business locations for subfranchisees.
Initial Training Hours
120
Training Location
Presotea Taiwan offices and Presotea locations in Taiwan.
Ongoing Support
After Master Franchisees begin selling Presotea Shops, Presotea (or its affiliate Presotea Taiwan) provides ongoing support. This includes taking actions to protect the Marks or System, providing periodic updates to the Operations Manual, and sharing ongoing lists of current and new menu items, recipes, suggested pricing, and approved vendors. Presotea offers periodic training programs for Master Franchisees' or their subfranchisees' managers and other employees for a fee, and provides ongoing consultation and advice. Additionally, Master Franchisees can request specific additional training onsite for a daily fee plus travel costs. Presotea maintains the www.presotea.com website and will manage the Network Marketing Program and Brand Fund Fees once implemented. Presotea also provides ongoing branded products and inventory as purchased by Master Franchisees for their subfranchisees, and offers additional services through its affiliate Presotea Taiwan upon request.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Commercial
Owner Participation
Full-Time
Territory Type
Exclusive
Territory Size Requirements
Presotea Master Franchise territories are defined geographically and encompass an entire U.S. state. For this offering, the protected territory is the State of Minnesota.
Staffing Notes
Presotea Master Franchisees are solely responsible for all recruitment, hiring, and management of their own employees. This includes training all their employees, as well as all subfranchisees and their employees, at a locally established training center. Owners and managers of the Master Franchise Business, however, are required to complete Presotea's Initial Training Program. Presotea does not consult on or participate in the Master Franchisee's employee hiring, management, payroll, or legal employment obligations. Master Franchisees are advised to consult appropriate employment professionals.