Your Questions Answered

Do you have a question about partnering with Spun Candy? Below, you’ll find answers to some of the more common questions we’re asked.

If you have a question that’s not listed here, please get in touch with our franchise team today.

General Questions

It’s our aim to have retail/masterclass units and kiosks in every major city around the world, operated by our Area Development Franchise Partners. We are focused on countries which:

• Are politically and economically stable
• Have a growing resident and tourist population
• Have strong and/or growing confectionery and experiential markets
• Can present an opportunity for scale
• Can offer steady year-to-year revenue growth through the sale of candy and our masterclass experiences.

We are looking for Area Developers who will open units across a 10-year period to include a flagship masterclass retail candy kitchen as well as further retail units (kiosks, concessions and standalone stores).

Here is a summary of the key points that we think makes for a good Area Development Franchise Partner:

Passion:  You’ll need to be passionate about candy and willing to immerse yourself in our brand. You’ll need to share our vision, be aligned with our values and be committed to implementing our winning formula.

Customer-focused: At Spun Candy, the customer experience is key, and you’ll need an appetite for delivering the very best customer experience.

Understand your market place: We’ll ask that you complete a detailed study of your demographics (individual and corporate) and retail unit positioning, and have a clear strategy for growth across the various revenue streams in the coming 3-5 years.

Industry-savvy: Ideally, we’re looking for prior experience in the Retail and/or Food & Beverage sectors. We feel this helps you to know how to position the Spun Candy brand optimally in your market. We are also looking for partners who can demonstrate a solid understanding of fast-moving consumer goods and food operations.

Appreciate the potential for growth: Having a keen eye for opportunities is a must, whether that’s in the corporate arena, seasonal or the gifting markets. We encourage our franchisees to capitalise on market opportunities and to open doors to new possibilities.

Long-term commitment: We expect our franchisees to be committed as long-term international partners, and we’ll need to ensure that you have the financial stability and cash reserves to allow investment in future growth opportunities and to manage uncertainty.

 

For more, see our Franchise Requirements page

Our dedicated units only sell Spun Candy products. We are happy to be part of a concession amongst multi-brand confectionery, chocolate and beverages.

As part of our area franchise development program, we provide you will all of the training you need, so that you can hand-make all of the products for sale within the agreed territory.

Becoming a Franchisee

Spun Candy operates internationally under an Area Development Franchise model, whereby we grant the exclusive development rights for an area, country or specific territory (within a country or across a region). An Area Development Agreement (ADA) requires the franchisee to open an agreed number of units during the development term. This is typically 10 years, with specific opening targets for each year of the development and minimum annual revenue targets.

The ADA requires the franchisee to set-up a business development infrastructure employing a suitably qualified and experienced team which includes candy makers, operational staff, business development, marketing and sales personnel, administrative and logistics personnel and builders for the fit-out of units.

During the period prior to the Area Development Agreement (ADA) being signed, we request that you carry out detailed market research and produce a business plan with financial projections. We also ask for you to recruit an initial operational management capability and start identifying sites for your first flagship unit. We would then move on to the design and procurement stage.

On average this process can take 3-9 months depending on many factors which include the lease agreement, training, manufacture of equipment and construction.

The next steps are typically as follows:

1. Initial phone conversation to establish interest and availability
2. Complete our application form and provide us with your business plan
3. Execute an NDA
4. Share franchise document and example financial model
5. Franchise discovery meeting with one of senior franchise team
6. Sign Letter of Intent
7. Area Development Agreement (ADA) produced
8. ADA Signed

Spun Candy Sites & Units

Once we have assessed the potential of your area, country or territory we will agree with you the development schedule for the minimum number of required units to be opened during the development term. As a guide we are looking for the development of a minimum of 5 units within 5 years, split across a flagship masterclass retail unit and additional kiosks, concessions and stand-alone units.

Within the first 1-3 years, we will require the flagship unit to support the growth of additional smaller retail units like kiosks. The units need to be carefully located in high footfall locations which attract the type of consumer that buys our candy or experiences our masterclasses.

Location is key so we are looking for ground or first-floor level, central positions in a Tier 1 mall or on-street (high street) location.

Additional units can be located in international airports, theme parks, attractions and other Tier 1 malls. We have learnt that attempting to limit your financial risk by paying less rent in a non-Tier 1 mall can have a very negative effect on revenue.

We need you to carefully select a number of prospective locations and prepare a detailed brief on customer demographics, other retailers/F&B outlets located nearby, and their positioning along with the footfall.

The Spun Candy flagship masterclass retail unit will need to be a minimum of 75 square metres. Smaller retail units and concessions can be from 20 square metres.

We have a turnkey solution for kiosks called Lollipods which are between 13 and 30 square metres and which can be installed in less than 24 hours into a high footfall location like an airport or mall.

We recommend that you have a blend of different sized and functioning units depending on the type of customer and our agreed development strategy.

We require you to provide us with a number of prospective sites with a report which details the location, geographical area and demographics, retail and F&B outlets in the vicinity along with a projected financial model for the location. We will then agree and approve a site for each unit.

We design each and every unit and ideally tailor the design to suit the area. This is undertaken by our international design team. We require you to appoint a local architect, project manager and contractor who works with our remote team who walk you through each of the design and build phases. We require you to provide us with a PDF floor plan layout and CAD files so we can produce a detailed tender pack (working drawings) for construction.

Spun Candy Support

Spun Candy supply all specialist candy making equipment along with the required kitchen and retail equipment you need to make and display candy and our products. Our specialist equipment is made bespoke to each location and we continue to develop it through our own research and investments in design in order to make it durable, reliable and operationally efficient. We supply some signage, others can be produced locally.

We provide you with a full equipment and construction list containing all the components and raw materials you need to construct your unit.

Our Lollipods are designed, developed and manufactured centrally, we send these to you in a container and installation can generally be undertaken in less than 24 hours.

We offer the following training and support:

Candy making training – this is conducted at our HQ or one of our regional stores and lasts 8 weeks. You can send up to 5 candy making staff and we teach them the operations along with the technical knowledge to make all of our candy and confectionery.

Operational training – we require you to send up to 3 members of the operational or management team to our HQ or regional stores and this will last between 1-2 weeks. The staff members attending will learn each aspect of SC business operations and unit management.

Opening support – we will send up to 2 members of our experienced franchise team to your area for the initial opening of your flagship unit to provide support before, during and after the soft and grand launch.

For more information, see our Franchise Support page

We believe in continued product development and maintaining an extremely high standard with all of our products. We offer 1-2 weeks of product development training per annum along with up to two principle visits per annum where we meet with you to discuss your historic sales performance, future marketing activities, operational support, logistics and ordering and discuss new development opportunities.

We have quarterly franchise conference calls, along with ad-hoc calls to assist with any other issues or ideas you may have.

For more information, see our Franchise Support page

Our proprietary ingredients of colours and flavours are purchased directly from Spun Candy. Sugar, glucose and other ingredients are sourced and purchased locally.

Our cost of ingredients and packaging for hard rock candy is generally under 20% (combined) for all of our handmade products (landed). We wish to maintain the high quality and premium nature of our products so we only work with a select number of specialist suppliers.

Your initial packaging order is purchased directly from Spun Candy. For future orders, you can purchase locally from approved suppliers once identified. We do have an economy of scale in purchasing and can generally achieve a better price for you than locally purchased.

We maintain a strict quality assurance programme. Prior to opening and after the initial training we will inspect each product line to ensure the quality that our customers expect is being maintained. Packaging, ingredients and other raw materials must be from approved suppliers. Every six months we will carry out an audit of our products. Alongside this we require that all units operate a strict food safety management system, which we of course train you on prior to opening.

Financials & Fees

The Franchisee must pay an Exclusive Area Development Fee upon signing the Area Development Agreement (ADA). The fee is calculated based on the agreed number of units to open in the development area multiplied by a % of the initial single unit fee for each unit.

Yes. You will pay the remaining balance of the single unit opening fees upon the lease signing of each additional location. We have a Design and Project Management (D&PM) cost for your flagship unit, with reduced D&PM cost for future units.

Each franchisee must pay for their exclusive Development Area interactive booking website and some other initial start-up costs.

Yes. The franchisee must pay a continuing royalty fee which is a % of the monthly gross sales minus any sales tax. There is an additional 0.5% payable towards the hosting, maintenance and updates for your interactive booking website.

No. However, we stipulate that you must provide us with a marketing plan for the following 12 months and allocate 2% of your monthly gross sales towards marketing spend. For the initial opening of your flagship unit in the Development Area you are required to allocate a set budget amount for the first 6 months of trading.

The initial investment and subsequent development of units under your development schedule can vary considerably. You should consider factors which include the location of units, rent, rates and labours costs along with the projected working capital you will require whilst you build up your clients and get known in your development area. The size of your unit and the cost of materials for the construction can alter the price per square metre considerably. You should also consider the duties, taxes and shipping costs, so all of these can be correctly modelled in your projected profit and loss and capital expenditure budget.

Spun Candy can assist with estimating some of these costs. Our experience has taught us that you will need to have a minimum of $US500K for your initial unit excluding your exclusive Area Development fee and you should budget for around $US1.0M to complete the development schedule within the term. The total external (inward) investment for the development schedule can be much less depending upon your net profits.

Spun Candy will work with you to thoroughly investigate the local market including local and international competitor prices, landed costs of raw materials including all proprietary items and the anticipated margins on our products. This information will be used to support the development of the ideal market positioning strategy and we will work with you to formulate a retail pricing strategy relevant to the market positioning strategy.

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