In early April 2024 the Wolf of Franchises Twitter Account reported Crumbl locations were down 38% in average revenue and down a whopping 59% in average net profit. In a discussion on Reddit, someone posted they knew a family friend that owned a Crumbl franchise that was in the top 30% of all Crumbl stores in sales and it did not make a profit. Does this mean that 70% of Crumbl locations throughout the nation are losing money?
As with most franchise businesses, it takes several locations to actually make real money. Business minds recognize there are much more profitable businesses elsewhere which is why so many franchise owners are getting into business for their first time – with a franchise. That said, it takes walking a fine line with expansion and sales growth. If there are 500,000 cookies sold in Raleigh, NC in the month April 2023 with just three (3) stores, that is going to mean highly profitable stores selling, on average, 167,000 cookies a month. Let’s say that in April 2024 the Raleigh area sells 650,000 cookies but there are now 20 stores. Stores are now selling 32,500 cookies, per month, on average. This is exactly what has happened with Crumbl.
Combine that with Crumbl being a TikTok fad in 2021 and 2022 and this is a recipe for disaster. If a store opened after October 2022 it has struggled to print a black number consistently. Even if a store is in a great location, there is no longer the fervor for customers to drive hours to get their favorite flavored cookie, for the first time!
While Crumbl has tried many new items and desserts, it is going to take a very strong summer for franchise owners to feel confident in their investment of both time and money. If Mother’s Day 2024 is not a strong sales holiday for Crumbl, franchise owners will likely start to see the writing on the wall and recognize this business really only between $5,000 and $25,000 a location per year. Most locations were making triple that, per month, in 2021 and 2022.