How much does it cost to open a The Spice & Tea Exchange franchise?

The total initial investment for a The Spice & Tea Exchange franchise ranges from $298,560 to $532,150. This includes the franchise fee of $38,750, buildout costs, equipment, and initial working capital.

What are the ongoing fees for a The Spice & Tea Exchange franchise?

The Spice & Tea Exchange franchisees pay a 7.0% royalty fee and a 2.0% advertising/marketing fund contribution. These are typically calculated as a percentage of gross revenue.

How much money can you make with a The Spice & Tea Exchange franchise?

Based on Item 19 financial performance data, the median The Spice & Tea Exchange franchise generates $342,011 in annual revenue. Estimated owner profit is approximately $23,941.

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Retail

The Spice & Tea Exchange Franchise Cost Breakdown

Complete investment analysis based on official FDD data

Total Investment

$298,560 – $532,150

Franchise Fee

$38,750

Royalty Rate

7.0%

Initial Investment Range

Low: $298,560 High: $532,150

The total initial investment to open a The Spice & Tea Exchange franchise ranges from $298,560 to $532,150, as disclosed in their Franchise Disclosure Document. This includes the one-time franchise fee of $38,750.

Midpoint estimate: $415,355

Franchise Fee

$38,750

One-time initial fee

The The Spice & Tea Exchange franchise fee is a one-time upfront payment made to the franchisor when you sign the franchise agreement. This fee grants you the right to operate under the The Spice & Tea Exchange brand and is included in the total initial investment range above.

Ongoing Fees

Royalty Fee

7.0%

of gross revenue

Ad/Marketing Fund

2.0%

of gross revenue

Total Ongoing Fee Burden: 9.0% of gross revenue

Combined royalty and advertising fund contributions before any other fees.

Other Ongoing Fees

Fee Type	Rate	Type	Notes
Royalty Fee	7.0	PCT	Monthly Royalty is the greater of 7% of Gross Sales or $1,750. Due on Payment Day of each Accounting Period (currently 5th day of month).
System Development Fee	1.0	PCT	Currently 1% of Gross Sales. May be increased to 3% upon 30 days' prior written notice. Used to maximize recognition of Marks and patronage of Stores. Due on Payment Day of each Accounting Period.
Local Advertising Requirement	1.0	PCT	Currently required to spend 1% of Gross Sales on local advertising. Must report expenditures quarterly within 15 days of end of calendar quarter. This is a spending requirement, not a payment to franchisor.
Local Advertising Cooperative Fee	2.0	PCT	If advertising cooperative is established, up to 2% of Gross Sales per calendar year. Contribution credited toward Local Advertising Requirement. Currently no Local Advertising Cooperatives in place.
Subscription, Support and Inventory Management Fee	550.0	VARIABLE	Currently ranges from $300 to $800. Fee for technology support systems including POS, inventory management, communication systems, email and security. High end of range for franchisees with optional second POS system. Due on Payment Day of each Accounting Period.
Integrated Music System Fee	120.0	VARIABLE	Monthly fee ranges from $90 to $150. Fee for audio programming and stereo equipment. To be determined by third-party administrator.
Spice UniversiTea Attendance Fee	1500.0	FIXED	Only payable by existing franchisees who attend or have employees attend already scheduled training sessions. Due one week prior to training start. New franchisees receive training covered by Establishment Fee.
Additional on-site Training or Assistance	600.0	VARIABLE	Per diem fee not to exceed $600 per day per trainer, plus travel costs and expenses. Due 15 days after billing. Only if franchisor requires or franchisee requests additional training.
Renewal/Successor Franchise	10000.0	FIXED	Due upon signing successor Franchise Agreement. Helps defray costs of reviewing and processing renewal request. Other conditions must be met for renewal approval.
Transferee Training Fee	5000.0	FIXED	Paid by transferee upon transfer of Franchise Agreement. Covers training for transferee and up to two designees (Spice UniversiTea, online and on-site training).
Transfer Fee	15000.0	FIXED	Due at time of transfer. Payable by franchisee if franchisor approves transfer of Store.
Kiosk Location Fee	1500.0	FIXED	For operation of non-traditional Kiosk Location. Due yearly upon execution of Addendum to Franchise Agreement.
Audit	N/A	VARIABLE	Due 15 days after billing. Payable if Gross Sales understated by 2% or more. Franchisor reserves right to conduct PCI compliance audit.
Administrative Fee	15.0	PCT	On demand. 15% of amounts paid by franchisor on behalf of franchisee for insurance, expenses, etc. Franchisee must also reimburse amounts advanced.
Interest	18.0	PCT	Lesser of 18% per year or highest contract rate allowed by law. Due within 15 days after billing. Payable on all overdue amounts.
Late Payment Penalties	15.0	PCT	15% of late amount. Due on payment of late amount. Payable on all late payments including interest.
Costs and Attorneys' Fees	N/A	VARIABLE	As incurred. Payable if franchisee default causes franchisor to incur attorneys' fees and costs.
Indemnification	N/A	VARIABLE	On demand. Franchisee must indemnify and defend franchisor if franchisee actions result in loss to franchisor.
Site Relocation Fee	7500.0	FIXED	$7,500 plus expenses incurred. Due upon completion. Payable if franchisor approves relocation of Store. Franchisor may lower fee at sole discretion.
Product and Service Sales/Mark-Ups	N/A	VARIABLE	As incurred. Franchisor, affiliates, suppliers or Approved Suppliers may derive revenue on products sold to franchisee. No limit or cap on amount or percentage of mark-ups.
Unauthorized Vendor/Product Fee	250.0	FIXED	Due within 10 days of notification. Must use Approved Suppliers and Products. $250 per item type and offense for using unauthorized suppliers/products. Franchisor may terminate agreement.
Hard Copy Manual Fee	N/A	VARIABLE	Upon request for hard copy. Free online access provided. If franchisee wants hard copy of Manual, must pay production costs.
Annual Conference	500.0	FIXED	As incurred. If franchisor schedules conference, may require attendance for up to 5 days per year. Franchisee responsible for lodging, travel, meals plus $500 per attendee fee.
Store Closure Fee	100.0	FIXED	As incurred. Penalty fee of $100 per day for each day Store is closed without franchisor approval, in addition to any other remedies.

What You Get

Financial Performance (Item 19)

Median Revenue

$342,011

per year, per location

Mean Revenue

$630,091

per year, per location

Profitability Estimate

Estimated Owner Profit

$23,941

per year

Profit Margin

7.0%

of revenue

Estimation method: benchmark

Estimated ROI (Simple Payback): 17.3 years

Based on midpoint investment of $415,355 and estimated annual owner profit of $23,941.

Unit Growth & Failure Rate

Avg. Annual Closure Rate

2.4%

Low risk — below industry average

Net Unit Growth

+12 units

From 2022 to 2024

Unit Activity History

Year	Start	Opened	Closed	Transfers	End
2022	81	+7	-1	—	86
2023	86	+6	—	—	89
2024	89	+8	—	—	93

Is a The Spice & Tea Exchange Franchise Worth It?

Based on the FDD data, here is a data-driven snapshot of the The Spice & Tea Exchange franchise opportunity:

Overall Score

69/100

Moderate opportunity

Est. Payback Period

17.3 yrs

Longer payback

Risk Level

Low

2.4% annual closure rate

The Spice & Tea Exchange shows a moderate score across our evaluation criteria. Careful due diligence is recommended. With median unit revenue of $342,011 and a combined fee burden of 9.0% of gross revenue, prospective franchisees should model their own financial projections carefully. For a complete analysis including risk factors, deal-breaker flags, and detailed financial modeling, see the full report.