How Much Does a Dunn Brothers Coffee Franchise Cost?

The 2026 Dunn Brothers Coffee Franchise Disclosure Document estimates $448,600 to $728,400 to open one Shop under a Franchise Agreement. The range applies to the Item 7 model of an approximately 1,000- to 1,900-square-foot end-cap location with a drive-thru. It includes the $30,000 Initial Franchise Fee, $10,000 Grand Opening Expenses payment, premises and equipment costs, opening inventory, and $14,500 to $54,000 of Additional Funds for the first three months.

The disclosed range should be read as a collection of separate assumptions rather than a single cash requirement. Some payments are fixed by contract, some are estimates for third-party purchases, and some depend on a lease, local authority or vendor quotation. A lender may finance selected equipment or improvements while refusing to fund deposits, legal work, early design invoices or operating reserves. For that reason, the amount a candidate must have available before construction can differ from both the contractual entry payments and the eventual project total.

A useful capital schedule assigns each obligation to one of four funding buckets: cash already available, landlord contribution, approved borrowing and an uncommitted gap. It should also state when the money is needed and whether the payment is refundable. This prevents a financing commitment that closes late from being treated as available for an earlier lease deposit or construction draw. It also exposes where a cost overrun would have to be absorbed if a quotation expires, a permit condition changes or work is delayed.

The official estimate does not replace a location-specific scope of work. The premises may need demolition, utility upgrades, accessibility work, grease handling, electrical service, ventilation, exterior work or other landlord-approved changes. Only amounts expressly listed in the disclosure are included in this article; no local allowance has been added. A buyer should compare the approved plans with contractor bids line by line and identify every item that is owner-furnished, landlord-furnished or excluded from the bid.

The same discipline applies to opening reserves. A reserve is intended to absorb early operating outlays, but its adequacy depends on when rent begins, when employees are hired, whether training occurs before revenue starts, and whether final construction invoices remain unpaid at opening. The disclosed allowance covers a stated initial period, not every possible delay. Personal living costs, unexpected repairs and financing payments should not be assumed to be covered unless the controlling documents and the buyer's own plan expressly provide for them.

Finally, financial screening and project funding answer different questions. Screening asks whether the applicant meets the franchisor's current profile. Funding asks whether all binding payments, third-party invoices and reserves can be paid when due. Passing a screening threshold does not prove that the site can be completed, and a high balance-sheet value does not necessarily provide accessible cash. The practical test is whether committed sources equal or exceed the scheduled uses with a documented contingency for unresolved items.

Capital snapshot

The disclosed range combines thirteen cost categories. The largest disclosed ranges are Construction, Remodeling and Leasehold Improvements at $187,500 to $300,200 and Furniture, Fixtures and Equipment at $150,500 to $225,000. The FDD's build-out assumption is an end-cap Shop of approximately 1,000 to 1,900 square feet with a drive-thru; its footnote states an average build-out cost of approximately $125 to $158 per square foot, with possible landlord construction credits.

Premises, design and operating assets

Source: FDD issued May 8, 2026, Item 7, pp. 9–11. Furniture, Fixtures and Equipment includes required equipment, millwork, exterior signage, interior menu boards, small kitchen tools, supplies, audio-visual and phone systems, and furniture, but excludes the roaster and its venting work.

Training, inventory, insurance and the first three months

Source: Item 7, pp. 10–12, of the FDD issued May 8, 2026. Additional Funds are already included in the total investment and should not be added a second time. The FDD excludes finance charges, interest and debt service, and it does not state that owner compensation is included.

The low end is not presented as a typical budget. It assumes the low amount for every category at once, including no sewer or water access charge, the lowest design and permitting expense, the lowest construction amount and the lowest working-capital allowance. The high end uses the high amount for every variable category. A site-specific plan should therefore reconcile each line separately rather than selecting a point inside the total range and treating the remaining categories as fixed.

Lease negotiations can move several lines together. A landlord construction credit may reduce the amount paid for improvements, while a triple-net lease can add common-area maintenance, real estate tax, insurance, utility, trash, promotional or merchant-association charges. The table combines initial rent and deposits with licenses and legal expense, but those obligations may be payable to different parties on different dates. Written proposals from the landlord, contractor, architect, equipment vendors and municipality are needed to map the actual cash sequence.

The standard Development Agreement requires a commitment to three Shops and adds a $30,000 Development Fee to the cost of opening the first Shop. The FDD therefore discloses $478,600 to $758,400 to enter the Development Agreement and open the first Shop. That range is not the cost to open all three Shops.

The Development Fee equals $15,000 multiplied by the number of committed Shops after the first. Under the standard three-Shop schedule, it is $30,000, fully earned and non-refundable when the Development Agreement is signed. The buyer signs the first Franchise Agreement and pays its $30,000 Initial Franchise Fee at the same time. For each second and subsequent Shop, the FDD provides a $15,000 credit against the Initial Franchise Fee otherwise due.

The largest cash commitments do not occur on one date. The Franchise Agreement creates an initial payment, the lease triggers another franchisor payment, and most premises and operating-asset costs are paid to third parties during site development and ordering.

1. Franchise Agreement signing: pay the $30,000 Initial Franchise Fee in a lump sum. It is fully earned and non-refundable when the franchisor signs.

2. Development Agreement signing, if applicable: pay the $30,000 standard Development Fee at the same time as the first Shop's Franchise Agreement and Initial Franchise Fee.

3. Lease execution: pay $10,000 in Grand Opening Expenses to the franchisor. The payment funds the Shop's initial marketing and advertising.

4. Design, permitting and build-out: pay architecture, permits, construction, deposits, licenses and municipal charges before opening or as incurred.

5. Equipment and opening orders: pay or finance Furniture, Fixtures and Equipment, the Computer System, roaster work where applicable, signage and Opening Inventory as orders are placed or before opening.

6. Opening through month three: use the $14,500–$54,000 Additional Funds allowance for disclosed start-up expenses; this allowance is part of Item 7, not an extra amount above the total.

This sequence matters because the total investment is not a single check and not every line can be financed on identical terms. The franchise fee and grand-opening payment are direct franchisor obligations. Deposits, permits and inventory are usually cash payments to other parties. Equipment may be purchased or financed, but lender proceeds may not arrive before lease deposits, design work or early construction invoices are due. A capital plan should identify the payee, required deposit, refundable status and expected funding source for each line before the lease is executed.

The three-month allowance begins around opening, when payroll, utilities, supplies, local advertising and other operating outlays start. It is already embedded in the total, but the FDD does not state that it will cover every cash deficit or every owner's personal living expense. The disclosed period should be compared with the expected construction completion, opening date and lender draw schedule so that opening funds are not consumed by earlier delays.

The FDD says the typical period from signing or paying consideration to opening is approximately nine to twelve months, depending on site possession, financing, equipment, fixtures, signs and inventory. The official franchise process also identifies FDD review and financial review as pre-approval stages. Under the FTC Franchise Rule, the disclosure document generally must be delivered at least 14 calendar days before a prospect signs a binding agreement or pays the franchisor or an affiliate; the FTC consumer guide explains that timing rule.

The principal percentage obligations are a 5% Royalty Fee, a 3% National Marketing Fund Contribution and a 1% Local Marketing Expenditure, each based on Gross Sales as defined in the Franchise Agreement. The percentages should not be converted into annual dollars without a disclosed Gross Sales figure.

Source: FDD issued May 8, 2026, Item 6, pp. 5–8. Gross Sales includes regular advertised prices for products and services connected to the Shop, subject to the specific exclusions and gift-card rules in Item 6.

The three percentages have different economic functions. The royalty is remitted to the franchisor. The national contribution is deposited into a system fund. The local amount is spending the owner must direct toward approved activity, although a shortfall can become a payment to the fund. The marketing cap limits the combined required marketing burden, but it does not cap the royalty, technology costs, delivery-platform charges, required maintenance or other operating expenses.

The definition of Gross Sales is broad. It covers products and services sold at, from or in connection with the location, including delivery, catering and other off-site activity, and it addresses gift cards, loyalty programs and business-interruption insurance proceeds. Sales taxes paid to the taxing authority, documented customer refunds and credits, and qualifying point-of-purchase discounts are excluded under the stated rules. The payment denominator should be tested against the exact contract language rather than a bookkeeping category with a similar name.

The Computer System creates another continuing technology obligation. Item 11 estimates $3,600 to $6,480 per year for optional or required maintenance, updates, upgrades or support contracts, separate from any Technology Fee. The system must also comply with changing System Standards at the franchisee's cost. The official training and support page describes store design, build-out guidance and operating support, but the FDD controls the cost obligations.

The official franchise website currently states a $100,000 minimum in liquid assets and a $500,000 minimum net worth. These are screening qualifications, not substitutes for the disclosed investment range. Liquid assets represent accessible capital; net worth includes assets less liabilities and is not the same as cash available to pay opening costs.

Meeting the website thresholds does not demonstrate that the full project is funded. A candidate could satisfy the net-worth screen with illiquid assets and still lack enough cash for deposits, non-financed equipment, cost overruns or the opening-period reserve. Conversely, accessible capital above the stated liquid-assets minimum does not eliminate the need to document the remaining funding sources. The relevant comparison is between cash available at each milestone and the amounts that cannot be deferred or borrowed.

The FDD does not state those two thresholds in Items 5, 6 or 7, and it does not disclose a separate minimum for non-borrowed funds. The figures should therefore be treated as current official supplemental requirements and reconfirmed during financial review on the official financial requirements page.

Does the franchisor offer financing?

No. Item 10 states that Dunn Bros Franchising, LLC does not offer direct or indirect financing, does not guarantee loans, leases or other obligations, and does not receive consideration for placing financing. Item 7 also excludes finance charges, interest and debt service. Third-party credit therefore sits outside the official investment range and depends on the applicant's creditworthiness, collateral and lender policies. Financing approval is not assured.

Item 6 includes event-triggered charges that are not part of the initial investment. Several are fixed, while others depend on the breach, vendor expense, transfer conditions or future system requirements.

• Renewal: the Successor Franchise Fee is $10,000 and increases by $5,000 if the required documents and payment are not completed before the current term expires. Renewal also requires modernization and reimaging at the franchisee's cost within 90 days after signing the successor agreement; no amount is disclosed.
• Transfer: the Franchise Agreement Transfer Fee is $20,000; the Development Agreement Transfer Fee is $5,000. Approval may also require upgrades, remodeling, refurbishment and paid training.
• Training and suppliers: replacement or additional training is $500 per day per trainer plus travel and other out-of-pocket expenses. An alternative-supplier request requires reimbursement of testing costs plus a $500 administrative fee per request.
• Default and closure: unauthorized temporary closure triggers $1,000 per week. Late amounts can carry a $100 Late Fee per occurrence plus 18% annual interest or the maximum lawful rate. A Royalty Fee can rise from 5% to 6% during specified non-compliance.
• Audit and intervention: audit and recordkeeping costs are estimated at $5,000 plus late fees when reports are not provided or an audit reveals an understatement over 2%. If the franchisor assumes management after abandonment or non-compliance, the Management Fee is 10% of Gross Sales plus costs and expenses.
• Vendor and system costs: amounts paid to vendors on the franchisee's behalf can be reimbursed at actual cost plus an administrative fee capped at 10%. Failure to attend a Franchise Conference can trigger the currently disclosed $100 per-meeting fee.
• Termination-related exposure: Lost Revenue Damages vary and can be based on the net present value of Royalty Fees for up to 156 weeks or the remaining term, plus actual attorneys' fees and costs when applicable.

Required-purchase rules also affect future costs. Item 8 permits designated or approved suppliers for the Computer System, branded products, uniforms, signage, paper supplies, syrups, coffee products, food and beverages. The FDD estimates that 75% to 90% of initial investment and 75% to 85% of ongoing operating expenditures will be directed to products and services restricted in some manner. Those percentages describe purchasing restrictions, not an additional fee or a forecast of total operating expense.

The key diligence task is to reconcile the site-specific budget, the latest FDD and the signed agreements. The official range is broad because premises condition, landlord credits, local utilities, construction, permits, equipment choices and the roasting format can change the final cash schedule.

Capital synthesis: one Shop carries a disclosed initial investment of $448,600 to $728,400; the standard three-Shop Development Agreement raises the entry range for the first Shop to $478,600 to $758,400. Construction and equipment drive most of the initial range, while royalties, marketing, technology, supplier restrictions and event-triggered fees continue or arise later. The principal unresolved issue is the mismatch between the current official website totals and the verified 2026 FDD.