Risk Score
Pending analysis
Investment Range
$562,090 - $1,290,931
Franchise Fee
$5,000
Total US Locations
158
Business Summary
The Human Bean operates espresso drive-thrus that specialize in preparing and selling espresso coffee, related products, and services. These outlets are designed as freestanding or attached structures with at least one drive-thru lane, operating under The Human Bean brand.
Corporate History
Casey Hawkins, Inc., operating as The Human Bean, was incorporated in Oregon on February 4, 2002. While its affiliates opened their first The Human Bean drive-thrus in southern Oregon in 1998, the franchisor itself began offering franchises in March 2002. The company's affiliates own and operate several drive-thrus, and the franchisor has no parent company.
Financial Overview
Investment Range
$562,090 - $1,290,931
Franchise Fee (Low)
$5,000
Franchise Fee (High)
$30,000
Marketing %
1%
Equipment Costs (Low)
$460,000
Equipment Costs (High)
$1,095,000
Working Capital
$25,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
The Human Bean's management has evaluated its ability to continue as a going concern and concluded there is no significant doubt, citing positive income and cash flows from operations for the year ended December 31, 2023. However, the Illinois Attorney General's Office has imposed a deferral requirement on initial franchise fee payments due to concerns about the franchisor's financial condition, as indicated in the Illinois State-Specific Rider, which calls into question the franchisor's financial ability to provide services and support.
Financing Details
The Human Bean does not offer any direct or indirect financing to its franchisees. This means that The Human Bean will not provide loans or guarantee any notes, leases, or obligations for franchisees.
Performance Metrics
Total US Locations
158
Franchised Units
146
Corporate Units
12
Avg Square Footage
1,750
Franchising Since
2002
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
The Human Bean has no litigation required to be disclosed in Item 3 of its Franchise Disclosure Document. However, the Illinois State-Specific Rider notes that the franchisor is not subject to any currently effective order from any national securities association or exchange suspending or expelling such persons from membership.
Bankruptcy History
The Human Bean has no bankruptcy history required to be disclosed in Item 4 of its Franchise Disclosure Document. No bankruptcies involving the franchisor or its key personnel have been reported.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their franchise agreement, The Human Bean franchisees must be in substantial compliance with the existing agreement and the Operations Manual. They must not have received more than three written default notices during the current term or more than two in the five years before renewal. Franchisees are required to provide written notice between 60 and 180 days before the agreement expires, pay a $3,000 renewal fee, sign the then-current form of the Franchise Agreement, and refurbish or remodel the drive-thru as reasonably directed by The Human Bean, with a spending limit of $65,000. Additionally, franchisees must be current on all financial obligations to The Human Bean and its approved vendors and must release all past and present claims against The Human Bean to the maximum extent permitted by law.
Training & Support Program
Franchisor Assistance
Before opening, The Human Bean assists with site selection by evaluating up to ten proposed sites and designating an exclusive one-mile radius territory upon approval. The Human Bean provides building specifications, an equipment list, and names of approved vendors for equipment (some must be purchased through them). They also loan a confidential Operations Manual, assist in procuring initial inventory, and help establish customer relationships with suppliers. The Human Bean provides 120 hours of mandatory initial training for two designated individuals, such as the franchisee and store manager, at their Oregon facilities (Medford or Portland), with franchisees covering travel and living costs. During operation, The Human Bean sells products for resale, provides on-site assistance for opening day, obtains online search directory listings for the outlet, conducts periodic inspections offering advice, prepares advertising content, and administers the Brand Fund (1% of gross sales revenue for advertising and marketing, which may increase up to 2%). They also offer optional additional on-site assistance for a fee.
Initial Training Hours
120
Training Location
Medford, OR or Portland, OR training facility
Ongoing Support
After opening, The Human Bean sells products for resale and provides reasonable ongoing support in response to written or telephonic queries. Representatives make periodic inspections, offering advice and assistance on management and conduct of the franchise. The Human Bean obtains and maintains online search directory listings for the outlet, makes advertising and promotional materials available for local use, and administers the Brand Fund (1% of gross sales revenue, potentially increasing to 2%) for advertising, public relations, market research, and promotion of THB-branded products and services. The franchisor also offers additional optional on-site assistance at a daily rate of $600 plus expenses if requested by the franchisee. The Brand Fund is overseen by The Human Bean, which considers input from the Franchisee Advisory Committee. The Human Bean may also, at its discretion, conduct research and development, provide recruitment assistance, suggest retail prices, and establish administrative procedures.
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
Absentee Allowed
Territory Type
Exclusive
Staff Count
15
Territory Size Requirements
The Human Bean grants franchisees an exclusive territory defined as a 1-mile radius from their approved drive-thru location. Within this defined territory, The Human Bean commits to not operating any company-owned outlets or granting a franchise for a competing business during the term of the franchisee's agreement. Continuation of this territorial exclusivity does not depend on sales volume, market penetration, or other contingencies.
Staffing Notes
The Human Bean recommends that franchisees' drive-thrus always operate under the direct supervision of either the franchisee or a designated manager. Franchisees must keep The Human Bean informed of the identity and qualifications of any employee acting as a manager. While managers are not required to have an equity interest, they must be capable of communicating with employees, customers, and suppliers. If a manager is deemed inadequately trained, The Human Bean may require additional training at the franchisee's expense. Initial training cost estimates are based on training for 15 employees for 10 days, 8 hours per day, at applicable minimum wage rates.