Watermill Franchise in 2024: Costs, Fee & FDD

Watermill Express, founded by Lani Dolifka and her husband Don in 1984, started with a mission to provide high-quality, affordable drinking water to communities. It became the first company in the U.S. to offer pure drinking water via self-serve kiosks, which revolutionized access to clean water. What began as a small operation in Brighton, Colorado, has now grown into one of the largest drive-up pure drinking water kiosk franchises. The company’s focus on sustainability, convenience, and affordability has made it a significant player in the water vending industry.

Watermill Express primarily offers purified water through its innovative vending kiosks, which filter and treat local water sources to deliver fresh, clean drinking water. Additionally, they provide ice through their kiosks in some locations. Their core customers are eco-conscious consumers, families, and communities looking for a cost-effective way to get clean water without relying on plastic bottled water. The brand appeals especially to those in suburban and rural areas, as well as environmentally conscious individuals looking to reduce plastic waste.

Today, Watermill Express boasts over 1,300 locations spread across more than a dozen U.S. states. It serves over 100,000 customers daily, ensuring they have convenient access to clean drinking water. The franchise has focused on maintaining strong relationships in local communities and continues to expand its footprint steadily. While currently only operating in the U.S., its growth potential hints at the possibility of expanding internationally.

Franchisees benefit from Watermill Express’s strong support system, including comprehensive training programs that cover everything from kiosk maintenance to customer service. The company offers ongoing assistance through marketing resources, technology updates, and a dedicated operations support team. Its low overhead model, combined with a solid training program, helps new franchisees hit the ground running, making it an attractive option for those looking to invest in a business that combines sustainability with community service.

Watermill Express Franchise Insights

1. Watermill Express has more than 1,250 kiosks in operation across 12 states, serving thousands of customers daily, which shows the scalability and consistent demand for its water services.
2. The franchise has a low overhead model, with minimal staffing needs since the kiosks are self-service, making it a great option for passive income generation.
3. Franchisees can expect to benefit from a proven system with over 35 years of experience in the clean water industry, supported by strong training and ongoing operational support.

Watermill Express Franchise Key indicators

How much does it cost to open a Watermill Express franchise?

Understanding the potential investment size and capital requirements is crucial when considering opening a Watermill Express franchise. These financial commitments, including initial franchise fees, equipment costs, and ongoing operational expenses, impact the feasibility and profitability of the venture. Thoroughly evaluating these factors ensures that potential franchisees are prepared for the financial responsibilities and can make informed decisions about their ability to sustain and grow the business, ultimately contributing to long-term success.

Min & Max Investment

Opening a Watermill Express franchise involves several key costs, which are outlined in Item 7 of the Franchise Disclosure Document (FDD). You can see a breakdown of the costs to open a Watermill Express below from the most recent Item 7 below:

The total estimated in this section is for the operation of three Watermill Express Stations, since is the only information given from the FDD. This can be found in the Item 7, which outlines the total costs a franchisee can expect to incur when starting a franchise, including the initial franchise fee, equipment, inventory, real estate, and other startup expenses. This section is crucial because it provides potential franchisees with a detailed understanding of the financial commitment required, helping them assess affordability and plan their investment strategy effectively.

Required Capital

For Watermill Express or similar franchises in the water vending industry, the required capital, liquid assets, and net worth can vary depending on location, kiosk type, and initial setup costs. While exact figures for Watermill Express may not be readily available, we can provide you with general estimates based on similar franchise models:

• Initial Investment For the operation of three water vending franchises, the estimated total investment ranges from $599,000 to $821,000. This would cover equipment, installation, and the cost of securing prime locations for kiosks. Assuming that you will finance your franchise investment, you should plan to have 20% of the total investment amount in the form of equity (cash) for the investment.
• Liquid Assets Franchisees typically need $50,000 to $100,000 in liquid assets to demonstrate they have the financial flexibility to support early operations and any unforeseen costs.
• Net Worth Many franchises in this space look for a net worth requirement of around $200,000 to $400,000, ensuring the franchisee has a solid financial foundation.

These estimates are based on typical franchise requirements for similar kiosk-based, low-overhead models. You’d want to confirm exact figures directly from Watermill Express if you’re seriously considering an investment.

How much does a Watermill Express franchise owner make?

Calculating the salary of a Watermill Express franchise owner involves analyzing gross sales to determine total revenue, assessing operational efficiency to understand profit margins, and accounting for franchisor fees and additional expenses such as rent, utilities, and payroll. Effective management of these factors can significantly impact the profitability and financial success of a Watermill Express franchise owner. This comprehensive financial analysis helps estimate net profits, from which the owner’s salary can be derived. A clear understanding of these factors ensures accurate salary projections and financial planning for sustainable business operations.

Watermill Express Revenue & Gross Sales

While specific financial requirements for Watermill Express franchises are not publicly disclosed, investing in this franchise is known for its attractive low-overhead model and strong demand for essential services like clean drinking water. Generally, kiosk-based franchises such as Watermill Express can perform well in locations with high visibility and strong community engagement. By maintaining efficient operations and capitalizing on the brand’s reputation for sustainability and convenience, franchise owners have the potential to achieve consistent revenue and favorable returns on their investment.

Which key factors impact the average revenue performance of Watermill Express franchisees?

Several factors likely contributed to the performance of Watermill Express U.S. franchisee median gross sales in recent years. First, increasing consumer awareness of sustainability and the reduction of single-use plastics has driven more customers toward kiosk-based water services. Additionally, heightened demand for affordable and convenient access to clean drinking water, especially in suburban and rural areas, has likely boosted sales. Economic factors, such as inflation and rising grocery costs, may have further motivated people to seek alternatives to bottled water, benefiting the franchise. Lastly, Watermill Express’s continued expansion into new markets and its focus on operational efficiency likely contributed to steady sales growth for franchisees.

Watermill Express Franchise Operational Costs

Operational costs for a franchise like Watermill Express are the ongoing expenses necessary to keep the water kiosk running smoothly and ensure customer satisfaction. These costs are essential for maintaining the business’s functionality and overall success. For a Watermill Express franchise, operational costs include:

• Water and Utility Costs The expenses related to sourcing and purifying water, as well as electricity costs to operate the water vending kiosks.
• Maintenance and Repairs Regular upkeep of the water kiosks, including cleaning, servicing, and repairing equipment to ensure high-quality water and kiosk functionality.
• Water Testing and Compliance Ongoing costs associated with testing water quality to meet local and federal health regulations, ensuring the kiosk delivers safe, clean drinking water.
• Kiosk Equipment Replacement As kiosks experience wear and tear, there will be costs to replace or upgrade parts such as filters, pumps, and dispensing systems.
• Local Marketing and Promotions Expenses for advertising and local promotions to attract customers, including social media ads and in-community campaigns to build brand awareness.
• Insurance Costs for general liability insurance, property insurance, and potentially environmental insurance, as well as worker’s compensation if the franchise employs staff for maintenance.
• Technology and Monitoring Fees for any software, monitoring systems, or technology upgrades to track water consumption, sales, and system performance remotely.

Careful planning and budgeting for these operational costs are crucial to ensure the success and financial health of your Watermill Express franchise.

Watermill Express Franchise Fees

Operational costs for a franchise like Watermill Express involve various ongoing fees that are crucial for maintaining operations and ensuring the franchise’s financial stability. These costs are tied directly to the franchise’s performance and help support the brand’s growth. Here are some key ongoing fees to consider:

• Royalty Fees For the first 12 months, there are no royalty fees. Starting from the 13th month, a royalty of 3% of monthly gross sales applies, increasing to 7% beginning in the 25th month.
• Brand Fund Contribution Franchisees contribute up to 2% of monthly gross sales to the brand fund, which supports national and local marketing initiatives.
• Additional Fees There may be other fees associated with technology upgrades, water testing, and compliance, as well as maintenance and repairs to keep the kiosk fully operational.

These fees, along with operational expenses, are critical to budget for in order to achieve long-term success in the Watermill Express franchise.

Watermill Express Franchise Earnings

While specific earnings data for Watermill Express franchises is not publicly available, we can provide an informed overview based on industry norms and the franchise’s unique model. Watermill Express, with its focus on clean water vending and sustainability, has the potential to generate consistent revenue, especially in areas where demand for affordable and eco-friendly water solutions is high. Key factors like kiosk location, local water demand, and effective maintenance management play a critical role in determining financial performance.

Industry benchmarks for similar kiosk-based franchises suggest that gross sales can vary significantly depending on the franchisee’s ability to secure prime locations and maintain high operational efficiency. Initial investment, ongoing costs, including royalty and brand fund contributions, should be factored in when estimating potential earnings. Franchises with a solid support system and training programs, such as Watermill Express, tend to position their franchisees for greater profitability and operational success.

Prospective franchisees should conduct thorough market analysis, considering local demographic trends and competition, to gauge potential earnings. By leveraging the brand’s reputation and adhering to best operational practices, Watermill Express franchisees can tap into a lucrative, growing market. Speaking with existing franchisees and financial professionals can offer additional insights into the realistic earnings expectations for this type of franchise.

How to Open a Watermill Express Franchise

To become a Watermill Express franchisee, the process involves several important steps that ensure both you and the franchise are aligned for success. Here’s an overview of the typical steps:

1. Initial Inquiry You or your franchise specialist submits an initial inquiry basic information about your interest and background. You should also conduct thorough research on the franchise, including seeing all of the information available on the Vetted Biz franchise intelligence platform, including access to the most recent Franchise Disclosure Document (FDD).
2. Franchise Application After the initial inquiry, you’ll be asked to fill out a formal application, which includes more detailed financial information and personal history. This helps the franchise assess your suitability as a franchisee.
3. Discovery Day Many franchises invite prospective franchisees to a “Discovery Day,” where you meet with key members of the corporate team, tour operational sites, and get a more hands-on look at the business model.
4. Financial Review and Approval Once you decide to move forward, Watermill Express will conduct a financial review to ensure you meet the investment and liquidity requirements. If approved, you’ll sign the franchise agreement.
5. Site Selection and Setup With the help of the franchise, you’ll work on securing a location for your kiosk(s), which is a critical step for your business success. The franchise provides support in finding optimal locations.
6. Training Program Before launching, you’ll go through comprehensive training on operational procedures, kiosk maintenance, marketing, and customer service. Watermill Express provides resources and support to get you ready.
7. Grand Opening and Start of Operations After installing your kiosk(s), completing training, and finalizing all logistics, you’ll have a grand opening to start operations. The franchise will assist with initial marketing and promotions to attract customers.

Pros & Cons

Pros

Low Overhead Costs: Since the kiosks are self-service, there’s minimal need for staff, reducing ongoing labor costs significantly.

Sustainability Appeal: Watermill Express aligns with eco-conscious trends by reducing plastic waste, which can attract a growing segment of environmentally-aware consumers.

Essential Service: Clean drinking water is always in demand, making the business model more recession-resistant and providing consistent revenue opportunities.

Flexible Location Options: Kiosks can be placed in various high-traffic areas, such as shopping centers or near residential neighborhoods, providing flexibility in site selection.

Cons

High Dependence on Location: The success of the kiosk relies heavily on securing a prime location with consistent foot or vehicle traffic.

Maintenance Responsibility: As a franchisee, you’re responsible for the ongoing maintenance of the kiosks, including repairs and water quality testing, which can add to operational costs.

Limited Product Range: Watermill Express primarily focuses on purified water, so there’s little opportunity to diversify revenue streams compared to other franchises that offer more varied products.

Competition in Certain Markets: Depending on the area, there could be competition from other water vending services or traditional bottled water suppliers.