Detailed Estimates of Yogurt Mountain Franchise Costs Based on Item 7 (Estimated Initial Investment) of Yogurt Mountain’s 2013 Franchise Disclosure Document
- No fee payable to the franchisor or its affiliates is refundable under any circumstances; fees paid to third parties will be refundable only if you are able to make arrangements with such third party for a refund.
1. Initial Franchise Fee: $30,000
- If you have signed a Development Agreement, the franchisor will apply $5,000 of the fee you paid when you signed the Development Agreement toward the initial franchise fee due under the Franchise Agreement up to the amount of the fees paid under the Development Agreement in the aggregate.
- If you are purchasing an existing Yogurt Mountain Store from another franchisee, the Initial Franchise Fee is $0, but you or the seller must pay the franchisor a transfer fee.
2. Leasehold Improvements: $112,000 to $182,000
- The franchisor’s estimate for leasehold improvements does not include any tenant improvement allowance that may be granted by landlords towards leasehold improvements.
- Tenant improvement allowances are site specific and dependent upon several variables, including rent, occupancy levels, and local market conditions, which are beyond the franchisor’s control.
3. Furniture, Fixtures, and Equipment: $96,645 to $154,617
- This estimate includes freight, installation, and applicable state and local taxes.
4. Signage: $9,000 to $17,000
5. IT, POS System: $24,750 to $27,750
6. Three Months’ Rent: $5,000 to $18,000
- The cost of acquiring or leasing a location for your Store will vary significantly depending upon the market in which the proposed site is located.
- A suitable building for a free standing Yogurt Mountain store will range from approximately 1,500 square feet to 2,500 square feet and will likely cost from $10 to $50 per square foot per year.
- Lease agreements vary but usually require the lessee to pay for maintenance, insurance, taxes, and any other charges or expenses for the land and building and the operation of the Yogurt Mountain Store, or they may require that the lessee reimburse the lessor for its proportionate share of these payments (plus interest) made on behalf of the lessee and pay minimum monthly rent and/or percentage rent.
- The lease estimate is for a 3-month period.
- The franchisor reserves the right to approve your lease.
7. Security Deposit, Business Licenses: $1,500 to $4,500
- The rent deposit may be refundable under the terms of the lease.
8. Opening Inventory and Supplies: $6,000 to $8,500
- Due to differences in local laws, prices, suppliers, geography, and commercial practices, you may elect to carry a larger inventory. Local costs will greatly affect this investment.
9. Grand Opening Advertising: $5,000
10. Training Expenses: $2,500 to $7,500
- This estimate covers the associated cost for payroll of management and staff training before the opening of your Store. This includes 2 weeks of training for a managing owner and a non-managing owner and a travel budget. Salaries will vary substantially by geographic areas and local market conditions.
- In addition, if you are opening your second or subsequent Store and the franchisor determines it is necessary to send a representative to your Store to provide grand opening assistance, you must pay a per day fee to cover the representatives’ salaries plus reimburse the franchisor the costs and expenses incurred by its representative, including the costs of travel, lodging, and meals.
- The estimated initial investment is subject to substantial variance due to delays and the securing of the required permits and license to train and operate the business as well as geographic location.
11. Professional Fees: $4,000 to $8,000
- This includes the estimated start-up fees for accountants, lawyers, and architects.
12. Insurance Premium: $9,000 to $14,000
- You must, at your own expense, keep in force insurance policies for each Store. The franchisor reserves the right to change types and amounts of coverage. This estimate is based on the franchisor’s current requirements.
13. Additional Funds – 3 Months: $15,000 to $25,000
- This reflects the franchisor’s estimate of the amounts needed to cover your expenses for the 1st three months of your Store’s operation and includes: replenishing your inventory, lease payments, initial advertising and promotional expenditures, payroll for managers and other employees, utilities, and other variable costs.
- These amounts do not include any estimates for debt service on loans that you obtain to finance your business.
14. Total Estimated Initial Investment: $320,395 to $501,867
- The estimated initial investment figures shown above for constructing and opening a Store are based primarily on the costs incurred by the franchisor’s affiliate in opening 12 existing Yogurt Mountain Stores. Because these figures are only estimates, it is possible to both reduce and to exceed costs in any of the areas listed above.