The franchise originated as Buff City Soap LLC, a Tennessee limited liability company that was formed in October 2013 to operate the initial Buff City Soap Makery retail location in Bartlett, Tennessee. Mr. Sutton has served as the Co-Interim Chief Executive Officer since April 2021. Mr. Sutton is also the Managing Partner of Guideboat Capital Partners, a private equity firm in Dallas, TX that he founded in February of 2018.
The products are targeted to both male and female consumers. There are currently 66 total Buff City Soap shops, 57 franchise locations and 9 company owned locations.
If you qualify to develop and operate multiple Buff City Soap franchises, then you will pay 50% of the initial franchise fee for each additional BCS Makery to be developed under the Development Agreement.
|Construction and Leasehold Improvements||$50,000 – $400,000|
|Furniture and Fixtures||$50,000 – $100,000|
|Equipment||$10,000 – $50,000|
|Architects and Engineering||$5,000 – $5,000|
|Other Professional Fees||$1,000 – $20,000|
|Opening Inventory||$45,000 – $70,000|
|Opening Supplies||$11,000 – $15,000|
|Computers, software, telecommunication||$6,000 – $15,000|
|Interior and Exterior Signs||$7,000 – $50,000|
|Training and Pre-Opening Expenses||$9,000 – $15,000|
|Pre-Opening Labor||$8,000 – $12,000|
|Market Introduction Budget||$15,000 – $40,000|
|Insurance||$1,300 – $4,000|
|Miscellaneous Expenses||$5,900 – $95,000|
|Additional Funds – 3 months||$63,000 – $96,000|
|Total||$307,200 – $1,082,000|
|Training Agreement Deposit Fee||$1,000|
|Initial Purchase of Materials||$1,000|
|Architect Design||$0 – $10,000|
|Leasehold Improvements||$30,000 – $60,000|
|Security Deposit, If Required||$0 – $15,000|
|Rent||$1,000 – 4,000|
|Furniture, Equipment, Primary Sign & Supplies||$4,430 – $12,130|
|Notebook Computer at Kumon Center||$500 – $2,000|
|Professional Fees||$1,000 – $3,000|
|Business License, Name Registration||$100 – $200|
|Kumon Lead Management Telephone System||$480 – $600|
|Recommended Reading List||$2,600|
|Fingerprinting, Criminal Background Check||$18 – $60|
|Payroll Cost for Assistants (3 months)||$7,350 – $8,820|
|Additional Funds – 3 Months||$13,500 – $18,000|
|Total||$64,458 – $139,890|
Buff City Soap does not make any representations about a franchisee’s future financial performance or the past financial performance of company-owned or franchised outlets. However, if you are purchasing an existing BCS Makery, the company may provide you with the actual records of that BCS Makery.
Royalty Fee: 6% of Gross Sales
In 2020 franchise revenues were $960,000
Estimated Total Franchise Sales: $16 million
Estimated Average Franchise Sales: $767,5000
This is just an estimated sales based on the franchisor’s income statement and can vary greatly depending on the length that the particular franchise location has been open and how well the business is run.
|Brand fund contributions.||$514,183||$194,127|
|Advertising and marketing||$396,244||$366,094|
|Net income (loss)||$727,154||$(566,772)|
Overall, Buff City Soap is a profitable business, with a net income of $727,000 in 2020. The year prior the company had a net income of ($567,000). Total revenues were $2.1 million while expenses were only $1.4 million indicating a healthy profit margin of around 33% for the franchisor. From 2019 to 2020 the company increased revenues by 178% from $721,000 to $2.01 million.
|Net income (loss)||$727,154||$(566,772)|
|Adjustments to reconcile net income (loss) to net cash provided by operating activities:|
|Depreciation and amortization||$3,232||–|
|Change in operating assets & liabilities:|
|Prepaids and other current assets||$(187,631)||$51,746|
|Contract acquisition costs||$(869,636)||$(54,206)|
|counts payable, other liabilities, and accrued liabilities||$838,381||$239,811|
|Deferred revenue and deferred development fees||$6,449,368||$2,492,387|
|Receivables and payables from affiliates||$(3,515,750)||$(716,623)|
|Cash provided by operating activities||$290,343||$243,435|
|Purchases of property and equipment||$(21,209)||–|
|Cash used in investing activities||$(21,209)||–|
|Net increase in cash and cash equivalents||$269,134||$243,435|
|Cash and cash equivalents at the beginning of the year||$282,726||$39,291|
|Cash and cash equivalents at the end of the year||$551,860||$282,726|
|Supplemental Disclosure of Cash Flow Information|
|Cash paid during the year for taxes||–||–|
In 2020, Buff City Soap had a net income of $727,000 and their cash, cash equivalents and restricted cash was $551,860 at the end of 2020 a 95% increase from the cash they started with at the beginning of the year. This increase in cash is a result of cash provided by operating activities and the largest positive cash item is deferred revenues and deferred development fees which accounted for $6.5 million. This increase in cash compared to 2019 which had cash at the end of the year of $283,000 indicates the company is producing higher revenues most likely due to the expansion effort of their stores.
The consumer market for a BCS Makery is highly competitive, generally mature and well developed. However, we believe that the segment of the soap and retail body products market targeted by us is still relatively unique and growing rapidly. We believe that the “experiential entertainment” provided to Buff City Soap customers as well as the quality of products offered by us will differentiate a BCS Makery in the marketplace and may provide a significant advantage over other soap and retail body products shops.
Think Buff City Soap is the right franchise for you, or are you interested in other franchise opportunities in the Retail Products and Services industry? Check out our listings page on the Vetted Biz website for thousands of franchises available for your investment.
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