Tiger Sugar Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$305,500 - $542,000
Franchise Fee
$50,000
Total US Locations
46
Business Summary
Tiger Sugar operates stores that offer tea, coffee, juice, and related products and services. Each Tiger Sugar store uses the franchisor's proprietary recipes and techniques for its products, along with other approved food and beverage items. The stores feature a distinctive interior and exterior design designed to be welcoming and easily identifiable for customers.
Corporate History
Tiger Sugar Franchise USA Inc. was formed as a New York corporation on November 18, 2019. The company, which promotes and sells Tiger Sugar franchises, began offering franchises in January 2020. The franchisor does not own or operate any Tiger Sugar stores itself, but an affiliate does. Its parent company, Tiger Sugar International Co., Ltd., based in Samoa, started offering Tiger Sugar franchises in Taiwan in 2018 and has been expanding its presence in Asia through various subsidiaries, affiliates, or master franchising arrangements.
Financial Overview
Investment Range
$305,500 - $542,000
Franchise Fee (Low)
$50,000
Franchise Fee (High)
$85,000
Royalty %
7%
Marketing %
1%
Equipment Costs (Low)
$98,000
Equipment Costs (High)
$235,000
Working Capital
$80,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Tiger Sugar Franchise USA Inc. has reported positive working capital in its financial statements. However, state regulators in Illinois and Maryland have required initial franchise fee payments to be deferred until the franchisor completes its pre-opening obligations to franchisees. This deferral requirement was imposed due to concerns about the franchisor's financial condition. The company also engages in significant related party transactions, including a loan to an affiliate and substantial accounts payable to a related party for sublicensing revenue.
Financing Details
Tiger Sugar Franchise USA Inc. does not offer any direct or indirect financing to its franchisees. The franchisor also does not guarantee any of the franchisee's notes, leases, or other obligations.
Performance Metrics
Total US Locations
46
Franchised Units
26
Corporate Units
20
Avg Square Footage
1,000
Franchising Since
2020
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
1
Litigation Summary
Tiger Sugar Franchise USA Inc.'s Licensor, Tiger Sugar International Co., Ltd., was involved in a Consent Order with the Maryland Securities Commissioner on February 10, 2021. This resulted from the Licensor authorizing a third party to operate a Tiger Sugar store in Maryland before the franchisor's offering was registered in the state. The Commissioner concluded this activity violated the Maryland Franchise Law. The Licensor agreed to cease and desist from unlawful franchise offers, offer rescission to the party operating the store, and ensure Tiger Sugar Franchise USA Inc. completed its Maryland registration application. There is no other litigation to report.
Bankruptcy History
Tiger Sugar Franchise USA Inc. has no bankruptcy history to report, as no bankruptcy is required to be disclosed in Item 4 of this document.
Agreement Terms
Initial Term
5 years
Renewal Term
5 years
Renewal Conditions
To renew a Tiger Sugar franchise agreement, franchisees must provide written notice to Tiger Sugar Franchise USA Inc. between six and twelve months before the current agreement ends. They must have no outstanding monetary or other obligations to the franchisor, its affiliates, approved suppliers, or the landlord, and must not be in default of any agreement provisions. Franchisees are required to sign a mutual general release and a new franchise agreement, which may include different terms, such as higher fees and modified territorial rights. Additionally, franchisees must meet current qualification and training requirements, renovate and modernize their premises to reflect current brand standards, provide proof of their right to occupy the premises for the renewal term, demonstrate sufficient financial resources, and pay a renewal fee equal to 50% of the average monthly gross revenues from months 25 through 48 of the initial term.
Training & Support Program
Franchisor Assistance
Tiger Sugar Franchise USA Inc. provides a range of assistance to its franchisees. Before opening, Tiger Sugar assists with site selection and approval, provides standard initial training for up to three people, and furnishes prototype design plans and specifications for store construction and layout, which are then customized (for a fee). The franchisor inspects and approves the store prior to opening and offers on-site pre-opening and initial opening supervision. Franchisees also receive copies of the confidential operations manuals and a list of approved suppliers. Tiger Sugar helps in developing a grand opening advertising program, for which the franchisee bears the cost. Ongoing support includes periodic inspections and evaluations of the store's operations, products, and services, making additional training programs available, and providing continuous advisory assistance on marketing, management, and operations. Tiger Sugar also establishes and manages the Advertising Fund and may set specific menu item pricing. In areas with an Area Representative, many of these services are provided by that representative.
Initial Training Hours
47
Training Location
Tiger Sugar Store of an affiliate or Area Representative, and virtual through videoconferencing
Ongoing Support
After a Tiger Sugar franchise opens, Tiger Sugar Franchise USA Inc. provides ongoing support including periodic inspections and evaluations of the store's operations, products, and services. The franchisor offers additional training programs and continuous advisory assistance regarding the operation and promotion of the store. Franchisees and their managers may be required to attend refresher courses, seminars, and other training for up to four days annually at the franchisor's headquarters or affiliate stores, and up to three days annually for system conventions. Tiger Sugar may also form a franchisee advisory council for input on advertising and marketing. The franchisor administers an Advertising Fund for system-wide marketing and may set menu item pricing.
Franchise Requirements
Ideal Candidate Profile
Tiger Sugar Franchise USA Inc. expects its franchisees to designate an owner with at least a 10% ownership interest to provide general oversight and management for the store. This Designated Principal or a General Manager must assume full-time responsibility for daily supervision and operations. If the Designated Principal lacks the necessary food service experience to manage the store full-time, the franchisee will be required to hire a General Manager with that experience.
Industry Experience Required
Yes
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Supervisory
Territory Type
Limited
Territory Size Requirements
Tiger Sugar Franchise USA Inc. defines territories, if awarded, based on factors such as whether the approved location is in an urban or suburban area, the number of residents and people working in the area, and the number of competitive stores. The territory's geographic definition will be a specified mile radius around the location, as detailed in the Franchise Agreement for each franchisee.
Staffing Notes
Tiger Sugar Franchise USA Inc. requires franchisees to maintain a competent and well-trained staff sufficient to provide prompt and courteous customer service. Employees must adhere to prescribed uniform and dress codes and meet minimum standards set by the franchisor. Each Tiger Sugar location must have a minimum of two managers or hourly employees trained in management activities on payroll at all times, who have completed all required training and certifications. Franchisees are solely responsible for all employment decisions, including hiring, firing, wages, recordkeeping, supervision, and discipline of employees.