Risk Score
Pending analysis
Investment Range
$128,199 - $682,199
Franchise Fee
$27,000
Total US Locations
28
Business Summary
Street Corner franchises the operation of convenience stores, known as Street Corner Stores. These stores sell a variety of products including prepackaged and prepared foods, beverages, non-food merchandise, sundries, and general convenience store goods and services. Street Corner offers two formats: Urban Markets, which are larger and can be located in strip shopping centers, gas stations, and other commercial areas, and Express Stores, which are smaller and typically found within enclosed shopping malls and other non-traditional venues. Franchisees operate these stores in conformity with the Street Corner system and brand standards.
Corporate History
McColla Enterprises, LTD., the franchisor of Street Corner, was established as a Kansas corporation on November 2, 1990. The company began offering Street Corner franchises in approximately July 1995. Street Corner operates by licensing its system for convenience stores, offering both larger Urban Market formats and smaller Express Store formats. The company's business primarily revolves around operating and franchising the Street Corner Store system.
Financial Overview
Investment Range
$128,199 - $682,199
Franchise Fee (Low)
$27,000
Franchise Fee (High)
$30,000
Royalty %
5%
Marketing %
1%
Equipment Costs (Low)
$34,500
Equipment Costs (High)
$362,900
Working Capital
$40,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Street Corner's financial health raises concerns about its ability to provide services and support to franchisees. As disclosed in its financial statements, Street Corner experienced a significant decrease in net income from $121,565 in 2023 to $66,972 in 2024. Furthermore, the company's cash flow from operating activities turned negative in 2024, reporting a deficit of $17,137 compared to a positive $209,532 in 2023. Total assets also saw a decline from $329,469 in 2023 to $246,228 in 2024. These factors, as noted in the FDD's special risks section, call into question Street Corner's financial capacity to support its franchise system.
Financing Details
Street Corner does not offer any direct or indirect financing to its franchisees. Franchisees will need to secure their own funding, and Street Corner does not guarantee any notes, leases, or other obligations.
Performance Metrics
Total US Locations
28
Franchised Units
28
Corporate Units
0
Avg Square Footage
1,875
Franchising Since
1995
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
Yes
Litigation Count
2
Litigation Summary
Street Corner has been involved in two litigation cases. The first case, Jay Dee Jig, Inc. v. McColla Enterprises, Ltd., was filed in New Jersey in April 2017 by a former franchisee. The franchisee sought a preliminary injunction to prevent Street Corner from terminating their franchise, but the matter was discontinued and concluded in 2017. The second case, which is more recent, is an administrative proceeding in California initiated by The Commissioner of Financial Protection and Innovation against McColla Enterprises, LTD., doing business as Street Corner. This complaint, filed on November 7, 2022, alleged that Street Corner violated California Franchise Law by offering and selling four area representative franchises while unregistered. Street Corner entered into a consent order, agreeing to immediately cease illegal offerings, pay a $10,000 administrative penalty, apply for updated registrations for its unit and area representative franchise offerings in California, and provide disclosure documents to the area representatives that were sold while unregistered.
Bankruptcy History
Street Corner's Chief Operations Officer, Adrian Aybar, filed for personal Chapter 7 bankruptcy in the U.S. Bankruptcy Court for the Southern District of California in March 2015, which was discharged in July 2015. More recently, Street Corner's Chief Executive Officer, Vikram Dhillon, filed for personal Chapter 7 bankruptcy in the U.S. Bankruptcy Court for the District of Arizona in August 2024, and that matter is currently under court consideration.
Agreement Terms
Initial Term
10 years
Renewal Term
5 years
Renewal Conditions
To renew a Street Corner franchise, franchisees must be in compliance with their Franchise Agreement and provide Street Corner with 180 days prior written notice of their renewal request. They are required to sign Street Corner's then-current Franchise Agreement and related agreements for the renewal term, which may have materially different terms. Franchisees must also sign a general release in favor of Street Corner, pay a renewal fee of $5,000, remodel and upgrade their store to meet current standards, and possess the legal right to continue occupying their store location. All owners and their spouses must also be in compliance with their agreements and personally guarantee the terms of the new renewal Franchise Agreement, and complete any additional training designated by Street Corner.
Training & Support Program
Franchisor Assistance
Street Corner provides various types of assistance to its franchisees. Before opening, Street Corner grants the right to operate a store within a designated territory and provides access to its confidential Operations Manual. It reviews and approves proposed store locations, designates the territory, and provides lists of approved suppliers and signage specifications. Street Corner also identifies the franchisee's store on its website and offers initial training for the franchisee or managing owner and one manager. After opening, Street Corner may require supplemental on-site training for an additional fee and communicates operating standards, approved vendors, and marketing standards. It also administers a brand development fund.
Initial Training Hours
16
Training Location
Franchisee's Store location
Ongoing Support
Street Corner provides ongoing support to its franchisees after opening. This includes establishing, updating, and communicating operating standards, procedures, and system requirements, including Approved Services and Products, System Supplies, and marketing standards through the Operations Manual and other communications. It provides names and addresses of approved vendors and suppliers. Street Corner may also, in its discretion, organize an annual conference (with a fee not exceeding $750) that the franchisee or Managing Owner must attend. Franchisees are responsible for monitoring and ensuring compliance with System standards.
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
Supervisory
Territory Type
Non-Exclusive
Territory Size Requirements
Street Corner franchisees receive a designated territory around their store location. Generally, this territory is a 2-mile radius from the store, but it can be smaller based on factors like population density, demographics, and geographical boundaries. For stores within shopping malls or similar facilities, the territory might be limited to the physical boundaries of the mall or facility, or even smaller if the mall exceeds 1.5 million square feet. Street Corner may define territories using zip codes, streets, highways, county lines, or other recognizable markers.
Staffing Notes
Street Corner franchisees are solely responsible for hiring, managing, and supervising their employees. All staff members must wear and maintain branded uniforms. Franchisees must ensure that all products and services are prepared, maintained, and served in accordance with Street Corner's system standards and manuals. Street Corner does not provide assistance with employee hiring or training, but requires the Managing Owner or an approved Operating Manager to supervise and manage the day-to-day on-site operations.