This article is based on the video featured above, originally recorded for Vetted Biz Youtube Channel.
Playa Bowls Franchise offers a quick-serve restaurant featuring acai bowls, pitaya bowls, coconut bowls, chia pudding bowls, oatmeal bowls, smoothies, juices, and other healthy food options. Playa Bowls is “your slice of summer, anytime”. Also caters for events to bring the summer vibe to any occasion. There are currently 25 company-owned restaurants and 73 franchised-run locations.
The Playa Bowls concept is the vision of founders Robert Giuliani & Abby Taylor who are both Jersey Shore natives & long time surfers. They were inspired with the ideas by chasing summer on surf trips to Panama, Costa Rica, Nicaragua, Puerto Rico, California & Hawaii. Playa Bowls was founded in June of 2016 in New Jersey.
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Notable Playa Bowls Investors:
In a 60/40 split, Playa Bowls co-founders Rob Giuliani and Abby Taylor received a majority investment from Tamarix Equity Partners and Pacific General Holdings. Giuliani will remain in his position as CEO and Taylor will remain as a chief marketing officer.
With this partnership, Playa Bowls is in the process of hiring key people to help grow the brand’s footprint on the West Coast and hopes to have 500 total stores by 2024
How Much is a Playa Bowls Franchise?
A Playa Bowls Franchise is currently $35,000.
Playa Bowls Restaurant Franchise Fee
The initial license fee for a Playa Bowls franchise is $35,000. This is the upfront fee that must be paid when opening a Playa Bowls franchise.
If you qualify to develop and operate multiple Playa Bowls Restaurants, then you will pay Playa Bowls a development fee equal to 100% of the initial franchise fee for the first Restaurant to be developed, plus 50% of the initial franchise fee for each additional Restaurant you commit to developing under the Multi-Unit Development Agreement.
Playa Bowls Franchise Cost
The estimated total investment necessary to begin the operation of a Playa Bowls restaurant ranges from $168,675 – $435,058.
Additional Cost Breakdown
The following costs are part of the upfront costs included in the initial investment. Many of these are one-time fees that are needed to launch the franchise.
Additional Cost Breakdown
| Rent – 3 Months | $7,500 – $25,000 |
| Lease Security Deposit | $2,500 – $8,333 |
| Utility Security Deposit | $0 – $1,500 |
| Design & Architect Fees | $4,500 – $10,000 |
| Leasehold Improvements | $50,000 – $175,000 |
| Signage | $2,000 – $12,000 |
| Equipment, Furniture and Fixtures | $35,000 – $75,000 |
| Point of Sale & Computer Equipment | $1,300 – $2,600 |
| Business Licenses & Permits | $2,000 – $4,000 |
| Professional Fees | $1,000 – $3,000 |
| Insurance | $1,875 – $2,625 |
| Initial Inventory | $10,000 – $30,000 |
| Training Expenses | $1,000 – $6,000 |
| Additional Funds – 3 Months | $10,000 – $40,000 |
| Total | $168,675 – $435,058 |
Ongoing Costs and Fees
Royalty Fee: 6% of Gross Sales Paid Monthly
Brand Development Fee: 1% of Gross Sales Monthly
How Much Do Franchise Owners Make?
Playa Bowls Franchise Sales Figures
Playa Bowls does not make any representations about a franchisee’s future financial performance or the past financial performance of company-owned or affiliate-owned or franchised outlets. The company also does not authorize employees or representatives to make any such representations either orally or in writing. If you are purchasing an existing outlet, however, Playa Bowl may provide you with the actual records of that outlet.
However, using the Franchisor income statement we can deduce from looking at the income statement line item “Franchise Revenue”:
Currently, Playa Bowls has a Royalty Fee of 6% of Gross Sales and 1% of gross sales for the brand development fee.
In 2020, the franchisor, Playa Bowl, had franchise revenues of $2.9 million, therefore we know this is 6% of the total franchise sales of about 73 franchise locations.
Estimated Total Playa Bowls Franchise Sales: $48.6 million
Estimated Average Playa Bowls Franchise Sales: $666,000
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
Playa Bowls Franchisor Income Statement
Statement of Income and Changes in Members’ Equity
| Year ended | December 31, 2020 |
|---|---|
| Revenues | |
| Royalties, net | $ 2,917,442 |
| Initial franchise fees | $ 442,025 |
| Brand development fees | $ 277,808 |
| Other | $ 18,625 |
| Total Revenues | $ 3,655,900 |
| Selling, General and Administrative Expenses | $ 1,251,110 |
| Net Income | $ 2,404,790 |
| Members’ Equity, beginning of year | $ 649,712 |
| Cumulative effect adjustment of adopting | |
| ASC 606 | $ (129,800) |
| Distribution to members | $ (1,505,351) |
| Members’ Equity end of year | $ 1,419,351 |
Playa Bowl Income Statement Key Insights
Overall, Playa Bowls is a profitable business, with a net income of $2.4 million in 2020. Total revenues were $3.65 million while expenses were only $1.25 million indicating a healthy profit margin. There was a $1.5 million in distributions to members emphasizing that money is being taken from the business to pay out the owners, but as seen in the cash flow statement the company still has about $1.9 million of cash on hand so the company has the ability to pay out its owners from the revenue generated from franchise locations.
Playa Bowl Franchisor Cash Flow Statement
Statement of Cash Flows
| Year ended | |
|---|---|
| Cash Flows From Operating Activities | |
| Net income | $ 2,404,790 |
| Adjustments to reconcile net income to net cash provided by operating activities: | |
| Depreciation | $ 685 |
| Bad debt expense | $ 14,997 |
| Changes in operating assets and liabilities: | |
| Franchisee receivables | $ (30,970) |
| Related party receivables | $ (17,604) |
| Prepaid expenses | $ (187) |
| Accounts payable | $ (17,986) |
| Accrued expenses | $ (3,640) |
| Deferred revenue | $ 546,975 |
| Net Cash Provided by Operating Activities | $ 2,897,060 |
| Cash Flows From Financing Activities | |
| Distribution to members | $ (1,505,351) |
| Net Cash Used in Financing Activities | $ (1,505,351) |
| Net Increase in Cash | $ 1,391,709 |
| Cash, beginning of year | $ 521,905 |
| Cash, end of year | $ 1,913,614 |
| Supplemental disclosure of Non-Cash Investing and Financing Transactions | |
| Cumulative effect adjustment to retained earnings ‘of adopting ASC 606 | $ (129,800) |
Playa Bowls Cash Flow Statement Key Insights
In 2020, Playa Bowls had a net income of $2.4 million, and their cash, cash equivalents and restricted cash was $1.9 million at the end of 2020 a 37% increase from the cash they started with at the beginning of the year. This extra cash flow is seen in their net cash provided by operating activities which was $2.9 million in 2020.
How many Playa Bowls units have opened and closed?
As seen in the table above both Playa Bowls franchise locations and company-operated locations have increased over the past three years. However, franchise locations have increased at a much greater pace, in the past three years there has been an addition of 65 restaurants with 15 new locations coming in 2020. These numbers indicate the franchise side of the business is expanding.
Conclusion
While Playa Bowls was only formed in 2016, it is seeing rapid franchise location growth with 65 new restaurants opened in the last three years.
Playa Bowl is uniquely positioned to capitalize on the new consumer trend of living a healthy lifestyle filled with nutritious foods.
Playa Bowls is in a new emerging market of healthy food options. However, this market is starting to grow in popularity with other companies such as Juice it Up, Jamba Juice, and Smoothie King capitalizing on the new wave of healthy eating and living.
We strongly recommend you speak to at least 5 Playa Bowls franchisees to better understand the financials (see questions to ask).
Think Playa Bowls is the right franchise for you, or are you interested in other franchise opportunities in the healthy food industry? Check out our listings page on the Vetted Biz website for thousands of franchises available for your investment.
