This post was updated on June 30, 2016 to reflect information from Wetzel’s Pretzels’ 2016 FDD (Item 7).
Detailed Estimates of Wetzel’s Pretzels Franchise Costs Based on Item 7 (Estimated Initial Investment) of Wetzel’s Pretzels’ 2016 Franchise Disclosure Document
- Except for the “additional funds” category described in note 17 below, this table shows expenses of a Bakery through opening day. None is refundable, except for insurance, utility, and security deposits, which may be partially refundable.
1. Initial Franchise Fee: $35,000
- If you have an option on a particular location, your $5,000 option fee is fully applicable to the initial franchise fee. The initial franchise fee for a second Bakery in the same mall location is $22,500.
2. Lease Review Fee: $1,850 to $2,000
- You must reimburse the franchisor for the legal fees it pays for review of your lease.
3. Business Premises: $5,000 to $20,000
- Figures are based on the assumption that premises will be rented and that the lessor will require an initial payment of one month’s rent and, in some cases, a security deposit of one month’s rent.
- The premises will probably be located in a mall or shopping center; and the typical size will range from 600 to 800 square feet, with 15 to 20 linear feet of frontage. If your Bakery is larger than this, some of your costs may be higher than shown in the “High” column.
4. Lease Improvements: $40,000 to $170,000
5. Food Preparation Equipment: $31,000 to $40,000
- This category includes such items as food preparation equipment and janitorial equipment.
6. Utility Deposits, Licenses, and Permits: $500 to $4,000
- This category includes sales tax deposits or bonds, construction permit, sewer hookup charges, and utility deposits.
7. Insurance: $500 to $2,500
8. Signs and Menu Boards: $6,000 to $20,000
9. Digital Display Boards: $8,000 to $12,000
- You will also incur monthly fees from suppliers for ongoing software and support, currently $29 per month.
10. Point-of-Sale Cash Register System: $2,700 to $5,700
11. Loyalty Program Scanner: $400 to $800
12. Initial Inventory and Smallwares: $5,500 to $6,000
13. Training Fee for Additional Trainee: $0 to $750
- The fee for training the first four people is included in the initial franchise fee. An additional training fee is assessed for each additional trainee. Your Designated Manager must attend the initial training program. Attendance by others is optional.
14. Training Expenses: $1,000 to $2,000
15. Grand Opening Advertising: $500 to $2,500
16. Office Equipment and Supplies: $500 to $2,500
17. Professional Fees: $1,000 to $3,100
- This figure includes the cost of setting up your books and attorney review of the franchise agreement.
18. Architect Engineers and Construction Manager: $5,500 to $15,000
19. Additional Funds – First 90 Days: $20,000 to $40,000
- This category includes 90 days’ wages for 3 full-time and 6 part-time employees, opening cash, rent ranging from $4,000 to $8,000 per month for three months, and other miscellaneous expenses incurred during the first 90 days of the franchised business’ operations.
- The franchisor relied on its own experience and review by its construction coordinator in estimating this figure. You should review these figures carefully in light of local conditions and the economy, consulting a business advisor if necessary.
20. Total: $164,950 to $383,850
Remote Mobile Unit
1. Remote Mobile Unit Fee: $5,000
2. Remote Mobile Unit: $12,000 to $50,000
- If you and your landlord agree that you will operate a Remote Mobile Unit in the same shopping center or mall where your Bakery is located, and the franchisor grants you a license to do so, you will incur costs of between $12,000 and $50,000 for manufacture and installation of the Remote Mobile Unit and for deposits required by utilities and the landlord.
3. Total: $17,000 to $55,000