Is a bubble tea franchise profitable?
Some are, and some are not. More than anything else it comes down to how the store is run: the hours the owner puts in, how closely they work with their retail performance coach, and how tightly they manage staff and stock. Site, lease and costs set the conditions, but they are rarely what separates two stores. No franchisor in Australia can lawfully guarantee that a franchise will be profitable, so the numbers for a specific store still have to be worked out before you commit.
The short answer
A bubble tea store makes money when its sales comfortably cover rent, wages, stock and the cost of any borrowing. The same brand, the same menu and two comparable sites can still end up in very different places, and what usually separates them is the operator. That is why the useful question is not whether bubble tea franchises are profitable in general, but what you would do with a particular store.
What decides whether a bubble tea store makes money
Nine things, and the order matters. The ones at the top are the ones you control, and they are where stores most often differ from each other.
| Driver | Why it matters | Where to get the real figure |
|---|---|---|
| How you run it | The biggest variable, and the one that most often separates two similar stores. Hours on the floor, consistency, and how well you use the support around you. | Current franchisees, and time spent in a store yourself |
| Your own hours | Working in the store yourself, or paying a manager to run it, changes the wage line more than any other single decision. | Your own plan |
| Your retail performance coach | Chatime assigns one to every franchisee. How closely you work with them shapes how quickly problems get spotted and fixed. | Ask current franchisees how they use theirs |
| Staff and rostering | A major cost you actively manage, and weekend, public holiday and late-night penalty rates add up quickly. | The Fast Food Industry Award, through the Fair Work Ombudsman |
| Cost of goods and waste | Tea, milk, toppings and cups. Waste control is one of the few costs that responds directly to how the store is run. | The disclosure document and current franchisees |
| Foot traffic and trading hours | Sales depend on passing trade and on how many hours the store can trade profitably. | Centre traffic data, and visiting the site at its busy times |
| Rent and occupancy | One of the largest fixed costs, and one you cannot change once the lease is signed. | The lease for the specific site |
| Franchise fees | A fixed part of the model and the same terms for every franchisee, so they rarely explain why one store does better than another. | The disclosure document |
| Capital expenditure and financing | Refurbishments fall due during the term, and interest on any borrowing reduces what the store returns to you. | The disclosure document, and your lender |
Why no franchisor can tell you what you will earn
Not because the information is being hidden, but because a figure for one store cannot predict another, and the law treats earnings claims seriously.
What the Franchising Code allows
A franchisor may choose to give you earnings information, but it is not required to. If it does, the Code requires a statement that the information is accurate to the best of its knowledge, and it must be given to you in or with the disclosure document, at least 14 days before you sign.
Why Chatime does not publish earnings
Two Chatime stores with identical fit-outs can perform very differently depending on the site, the lease and how they are run. A number on a website cannot tell you what a particular store will do, so Chatime does not publish turnover, profit or return-on-investment figures.
If anyone tells you what you will earn
Treat it as a projection, whoever it comes from. Ask what it is based on, test it with your own accountant, and check it against what current franchisees actually report. A projection presented as a certainty should slow you down, in any franchise system.
How to work out whether a specific store would be profitable
Six steps, all of which you can take before you sign anything.
Get the disclosure document
It sets out the full fee structure, what can be required of you during the term, and contact details for current and former franchisees. Everything else builds on it.
Pin down the franchise fees
Note the royalty and marketing levy, and exactly what each is a percentage of. A percentage of gross sales is not the same as a percentage of net.
Get the lease terms for the actual site
Rent, outgoings, review dates and the length of the term. Model the store on its real rent, not an average.
Model the wages properly
Build the roster against the Fast Food Industry Award, including casual loadings and penalty rates for weekends, public holidays and late nights, and decide how many hours you will work yourself.
Talk to franchisees you choose
Use the contact list in the disclosure document rather than a curated one. Ask how long their store took to reach steady trade, and how their costs compared with what they expected.
Build a conservative model with your accountant
Test what happens if sales come in lower or costs higher than planned. If the store only works on the optimistic case, that is worth knowing now.
Bubble tea franchise profitability: your questions
Is a bubble tea franchise profitable?
Some are, and some are not. More than anything else it comes down to how the store is run: the hours the owner puts in, how closely they work with their retail performance coach, and how tightly they manage staff and stock. Site, lease and costs set the conditions. No franchisor in Australia can lawfully guarantee that a franchise will be profitable, so the numbers for a specific store still have to be worked out before you commit.
How much does a bubble tea franchise make in Australia?
There is no reliable single figure. Results vary widely between stores, even within the same brand, because rent, wages, trading hours and foot traffic differ from site to site. Franchisors are not required to publish earnings, and a figure quoted without the site, lease and costs behind it tells you very little. Build your own numbers from the disclosure document, the lease and conversations with current franchisees.
What are the biggest costs of running a bubble tea store?
Wages, rent and occupancy, and cost of goods such as tea, milk, toppings and cups. Wages and waste are the two you actively manage day to day, which is why they vary most between stores. The ongoing royalty and marketing levy, refurbishments during the term and interest on any borrowing also come out of what the store returns to you.
How long does it take for a bubble tea franchise to make money?
It depends on the store, and no franchisor can promise a timeframe. Opening costs, how quickly the store reaches steady trade, the lease and your financing all affect it. Ask current franchisees how long their stores took to reach steady trade, and model a range of outcomes with your accountant.
Can a franchisor tell me how much I will earn?
A franchisor can choose to give you earnings information, but it is not required to. If it does, the Franchising Code of Conduct requires a statement that the information is accurate to the best of its knowledge, and it must be given to you in or with the disclosure document at least 14 days before you sign. No franchisor can lawfully guarantee what you will earn.
Does Chatime publish earnings figures?
No. Chatime does not publish turnover, profit or return-on-investment figures. Two stores with the same fit-out can perform very differently depending on site, lease and operation, so a figure on a website cannot tell you what a particular store will do. Total investment for a new Chatime store starts at $300,000 + GST, and the fee structure is set out in the disclosure document.
Which award covers bubble tea shop staff in Australia?
Bubble tea stores are generally covered by the Fast Food Industry Award 2020, which includes preparing and selling takeaway beverages. It sets minimum pay rates, casual loadings and penalty rates for weekends, public holidays and late nights. Check current rates with the Fair Work Ombudsman, as they change each year.
How do I judge a store before I buy it?
For a new site there is nothing trading yet, so you work from the fee structure, the lease and conversations with current franchisees. A store already trading you can go and watch. Visit at the busy times, after school, over lunch and through the school holidays, and ask the current owner how it is going. Take what you learn to your own accountant.
Working out the numbers for a Chatime store?
Enquire and a franchise consultant will take you through the fee structure and the sites actually available. There is no application deposit.
Enquire about a Chatime franchise