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Sweetwaters Coffee & Tea

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Food & Beverage
Coffee & Tea

Sweetwaters Coffee & Tea

Sweetwaters Coffee & Tea Franchise FDD, Costs & Fees (2025)

Sweetwaters Coffee & Tea is a specialty café franchise that serves premium coffee, tea, and global-inspired beverages in a cozy and welcoming environment.

Sweetwaters Coffee & Tea is a specialty café franchise founded in 1993 by Lisa and Wei Bee in downtown Ann Arbor, Michigan, near the University of Michigan. The company is headquartered at 123 W. Washington Street, Ann Arbor, MI. It began franchising in 2004 and has since expanded to nearly 40 locations across 12 states in the U.S.

The franchise offers a globally inspired menu of premium beverages and light fare. Popular drinks include the Dragon Eye coffee, French Vietnamese Au Lait, Thai Iced Tea, and Ginger Lemon Iced Tea.

Sweetwaters is known for using real, high-quality ingredients such as Japanese matcha, freshly brewed cold brew coffee, and handmade whipped cream. The café also serves a variety of pastries, desserts, and breakfast and lunch sandwiches.

What sets Sweetwaters apart is its strong connection to local communities and its authentic cultural roots. Each location showcases local art and often hosts community events, creating a warm and welcoming atmosphere.

Initial investment

Here's what you would need to invest if you were to start this franchise. These costs are provided by the franchisor in the Franchise Disclosure Document.

Type of Expenditure Amount
Initial Franchise Fee $39,500
Grand Opening Advertising $10,000
Initial Training Fee $7,000
Initial Training Expenses $0 – $3,639
Pre-Construction $6,750 – $7,150
Permits $1,200 – $6,000
Leasehold Improvements $185,214 – $298,647
Exterior Signage $6,259 – $18,288
Utility Deposits $0 – $300
Fixtures and Equipment $147,715 – $270,474
POS System, including license fee $2,546 – $4,249
Organizational Costs $500 – $1,500
Opening Inventory and Supplies $24,305
Construction Management $0 – $10,000
Insurance – Liability and Workman’s Comp (3 months) $1,383 – $2,607
Real Estate Costs – 3 Month’s Rent Plus Security Deposit $10,920 – $21,320
Additional Funds – 3 Months $30,000 – $40,000
Total $473,292 – $764,979
Type of Expenditure Amount
Initial Franchise Fee $39,500
Grand Opening Advertising $10,000
Initial Training Fee $7,000
Initial Training Expenses $0 – $3,639
Pre-Construction $6,750 – $7,150
Permits $1,200 – $6,000
Leasehold Improvements $185,214 – $298,647
Exterior Signage $6,259 – $18,288
Utility Deposits $0 – $300
Fixtures and Equipment $147,715 – $270,474
POS System, including license fee $2,546 – $4,249
Organizational Costs $500 – $1,500
Opening Inventory and Supplies $24,305
Construction Management $0 – $10,000
Insurance – Liability and Workman’s Comp (3 months) $1,383 – $2,607
Real Estate Costs – 3 Month’s Rent Plus Security Deposit $10,920 – $21,320
Additional Funds – 3 Months $30,000 – $40,000
Total $473,292 – $764,979

Sweetwaters Coffee & Tea

2024

Franchise Disclosure Document

Number of units

Training

Sweetwaters Coffee & Tea provides a comprehensive training program to ensure franchisees are well-prepared to operate their cafes successfully. The training encompasses various formats and stages, combining online modules, in-person sessions, and hands-on experience.

  1. Virtual Training Modules
    Franchisees begin with seven virtual training modules conducted by Sweetwaters' operations and marketing staff. These modules cover essential aspects of the business, including daily operations, marketing strategies, and customer service protocols.
  2. In-Person Training at Headquarters
    Following the virtual training, franchisees attend an eight-day in-person training at Sweetwaters' Home Office in Ann Arbor, Michigan. This segment involves working in flagship cafes, allowing franchisees to gain practical experience in a real-world setting.
  3. On-Site Pre-Opening Support
    Prior to the grand opening, Sweetwaters provides five days of on-site support at the franchisee's location. This includes assistance with final preparations, staff training, and ensuring that all operational standards are met for a successful launch.

Territory Protection

Sweetwaters Coffee & Tea offers territory protection to its franchisees under specific conditions. Once a franchisee secures a location approved by the franchisor, Sweetwaters defines a "Designated Territory" for that particular café.

This territory is outlined in the Data Sheet attached to the Franchise Agreement and typically grants the franchisee exclusive rights within that defined boundary. The protection means that within the designated area, the franchisor will not establish or allow another Sweetwaters café to operate, thereby shielding the franchisee from internal competition.

However, this exclusivity is contingent on compliance with the franchise agreement and operational standards. In the case of multiple locations under a Development Agreement, each franchise location is individually assigned its own territory upon approval of the premises.

Competitors

Below are some of

Sweetwaters Coffee & Tea

key competitors in the

Coffee & Tea

sector.

Franchise
Franchisees
Initial fee
Total investment
Revenue
Sign up
Gross Profit
Sign up
EBITDA
Sign up

34

New
+
0%
0%

$39,500

$473,000

$765,000

n.a.

$599,000

$xxx,xxx

n.a.

xx%

n.a.

n.a.

xx%

n.a.

Competitors

Fuelify

Fuelify is a specialty beverage franchise offering energy teas, milk teas, smoothies, spritzers, coffee and freeze-dried candy, serving boba lovers and on-the-go guests, and known for vibrant flavors, customizable drink combinations and a fun, social “boba hangout” atmosphere.

Franchisees

?

0
+
n.a.
n.a.
Investment

?

$83,000 - $127,000

Mercato Cucina

Mercato Cucina is a foodservice franchise concept offering Italian-inspired fast-casual meals and marketplace items, serving local residents seeking refined yet convenient cuisine, and known for chef-crafted menus, fresh pastas and sauces, and an Italian deli–style experience with gourmet take-home products.

Franchisees

?

0
+
n.a.
n.a.
Investment

?

$199,000 - $346,000

Boba Nation

Boba Nation is a beverage franchise offering bubble tea, smoothies, and specialty drinks, serving younger consumers and families who enjoy customizable beverages, and known for extensive flavor combinations, vibrant store branding, and scalable formats designed to capture growing boba demand.

Franchisees

?

1
+
n.a.
n.a.
Investment

?

$350,000 - $495,000

Parlay Cafe

Parlay Cafe is a hybrid café and coworking franchise offering specialty coffee, light bites, and flexible workspace, serving remote professionals, entrepreneurs, and small teams, and known for memberships, meeting rooms, and thoughtfully designed spaces combining café comfort with business amenities.

Franchisees

?

0
+
n.a.
n.a.
Investment

?

$203,000 - $459,000

Puffles

Puffles is a dessert-and-beverage franchise offering Hong-Kong-style egg waffles, customizable ice cream treats and bubble tea, serving dessert lovers and social café customers, and known for trendy format, fun social-media appeal and low investment.

Franchisees

?

0
+
n.a.
n.a.
Investment

?

$112,000 - $296,000

Tea Lounge

Tea Lounge is a café franchise offering specialty teas, bubble tea, and light café fare in stylish modern settings, serving younger consumers and café-seekers, and known for trendy ambiance, customizable drinks and franchise-ready formula.

Franchisees

?

0
+
n.a.
n.a.
Investment

?

$276,000 - $406,000

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