Cost Structure of Bubble Tea Franchise Units

As bubble tea gains popularity across India, entrepreneurs are increasingly exploring it as a viable business opportunity. Understanding the cost structure of a bubble tea franchise unit is essential before investing. While expenses vary by brand and location, most bubble tea franchises follow a relatively consistent financial model.

1. Franchise Fee: Most reputed bubble tea brands charge an initial franchise fee ranging between ₹3–8 lakhs. This fee typically includes brand licensing, initial training, and basic marketing support.

2. Setup Cost: The interior setup, kitchen equipment (like sealing machines, blenders, and refrigeration units), counters, signage, and branding may cost ₹6–12 lakhs depending on the format—kiosk, takeaway, or dine-in. Kiosk formats tend to be more affordable and quicker to set up.

3. Raw Materials & Inventory: Brands often supply core ingredients like tea bases, tapioca pearls, and flavored syrups to maintain consistency. Initial inventory costs can range between ₹1–2 lakhs.

4. Rental & Staff: Monthly expenses will include rent (₹30,000 to ₹1.5 lakhs based on location), staff salaries, and utilities. Many successful outlets operate with 3–4 employees for maximum efficiency.

5. Marketing: Initial local marketing, digital promotions, and opening offers may require an additional ₹50,000–₹1 lakh.

6. Royalty Fees: Most bubble tea franchises charge a monthly royalty of 5–8% on gross sales.

In total, starting a bubble tea franchise typically requires an investment of ₹10–20 lakhs. The return on investment can be high if placed in a high-footfall location with strong brand support.