How to Open a Daylight Donuts Franchise

by Business Editor; Updated September 26, 2017

How to Open a Daylight Donuts Franchise. Founded in 1954 in Tulsa, Oklahoma, Daylight Donuts has over 900 retail outlets worldwide. A privately held company, the Daylight Donut Flour Company, LLC licenses qualified individuals to own, operate and produce Daylight's unique brand of donuts in approved locations. Daylight Donut stores have the same appeal of a national franchise, but in actuality, individual owners purchase a license to operate their store and not an actual franchise agreement. This means that all profits belong to the operator. As another plus, the company is more than willing to help with all the aspects required to open your own store including on-site training.

Items you will need

  • Starting capital
  • Approved location
  • License agreement with Daylight Donuts
Step 1

Contact a company like Franchise Opportunities or Franchise Business Broker who can provide further information about opening a franchise business. These companies provide information on all kinds of businesses with franchise opportunities, including Daylight Donuts. Request information about franchise requirements for several companies, which will help you decide if a Daylight store is the best route for you.

Step 2

Go directly to the source. Contact the Daylight Donuts company directly to learn what they can do for you. By opening a licensed Daylight shop, owners will have access to proprietary donut mixes and equipment and ingredients required to make "genuine" Daylight Donuts. The company will assist potential licensees in every aspect of opening of a shop without the added cost of a franchise fee like you will find in some franchises.

Step 3

Find a good location for your shop. Locations for a licensed Daylight Donut shop must be approved and like any profitable business, is a key element to your success. The company offers advice and guidance on where to situate your shop based on sound marketing strategies. Through research and past experience, Daylight can help individuals choose the best location for their new enterprise.

Step 4

Estimate required startup costs to ensure you can afford the venture. Costs will vary from state to state with several factors that figure into this cost. For example, the size of the approved building that you chose and all pre-opening expenses such as inventory, equipment, signage and advertising will all affect the initial dollar amount required for your investment.

Step 5

Make sure you have the funding available to cover these startup expenses. If you don't have enough money, think about getting a partner or taking out a small business loan.

Step 6

Setup required equipment. Daylight Donuts will assist in equipment layout based on a floor plan that is unique to the building housing your shop. The company will deliver your equipment and ingredients directly to your location. Feel free to consult with them on all phases of opening your shop or areas of operation you have questions or concerns about.

Step 7

Hire employees and start training. Daylight Donuts also provides on-site training, so once you have your employees in place, someone will come to your shop to train everyone on how to properly make "genuine" Daylight Donuts.

Tips

  • According to the Daylight Donuts website, donuts are the second most profitable food in the Nation and in a normal operation, owners can expect gross sales to be allocated to 1/3 overhead, 1/3 food cost and 1/3 profit margin with the potential of these numbers to be exceeded based on management skills. Opening a Daylight Donuts Franchise actually requires a license agreement and not a franchise agreement. This allows individual owners to keep all the profits while still allowing them to open a business with the look and feel of a franchise, a federally protected trademark, branded packaging, uniformity in products and a protected territory. The Daylight Donut Flour Company doesn't take any percentages or charge any fees for a license. All profits belong to the individual owners.

Warnings

  • Make sure you can afford to run at a loss in the beginning. Even though this is a recognized chain which will help you in the marketing of your business, a majority of new businesses will run in the red for the first 1 to 2 years if for no other reason than to recoup their startup costs.