Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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Franchise Costs: Detailed Estimates of Pinkberry Franchise Costs (2017 FDD)

by Franchise Chatter on June 14, 2013

in Franchise Costs, Frozen Yogurt Franchises

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Pinkberry Frozen Yogurt Franchise Photo by mezzoblue

This post was updated on September 14, 2017 to reflect information from Pinkberry’s 2017 FDD (Item 7).

Detailed Estimates of Pinkberry Franchise Costs Based on Item 7 (Estimated Initial Investment) of Pinkberry’s 2017 Franchise Disclosure Document

  • All of the figures below are estimates of certain initial start-up expenses for a single Shop. The listed expenses are not exhaustive and Pinkberry cannot guarantee you will not have additional expenses in starting your Shop.

1.  Initial Franchise Fee:  $35,000

2.  Lease Review Fee:  $0 to $1,250

3.  Architect, Engineer, and Other Design Professionals:  $5,000 to $18,500

4.  Expenses While Training:  $2,400 to $4,800

5.  Acquisition of Real Estate/Deposits and Initial Rent (minimum five year lease):  $9,340 to $23,350

  • Unless you purchase the premises at which your restaurant will operate, you will negotiate a lease directly with the landlord of the premises. Real estate costs can vary widely depending upon a multitude of factors, including whether the property is purchased or leased; local market conditions; the size, type, condition, and location of the property; and zoning requirements.
  • The size of a typical site is between 650 and 1,200 square feet. Kiosk spaces range from under 200 square feet plus storage to 450 square feet.
  • The probable locations for a Pinkberry restaurant are:  regional malls, strip/lifestyle shopping centers, airports, office buildings, downtown (street front), college and university campuses, sports venues, and entertainment venues, with sizes of the property and building the Pinkberry restaurant could be located in ranging from 1,000 square feet for a stand-alone location to over one million square feet for a large regional shopping mall, airport, or college campus.

6.  Construction:  $124,100 to $238,000

  • The cost of construction and remodeling depends on the size and condition of the premises, the local cost of contractors and other trades, and the location of your restaurant. The amount may be less if the lessor provides a construction allowance for tenant improvements and on how you negotiate the terms of your lease.
  • The construction costs generally range from $124,100 to $238,000. The fee range provided is applicable only to interior Shop space, but includes the cost of Pinkberry’s signature “trellis.”
  • If the site you select requires exterior repair, seismic work and retrofitting, engineering costs for retrofitting, refurbishment, and/or other design improvements to meet Pinkberry’s standards and brand image (such as a corner location that would require treatment on more than one side), you will incur additional, and possibly significant, costs beyond the range provided.
  • Construction costs also vary considerably depending on fair market values in your area; size, condition, and location of the premises; labor costs (union versus non-union); zoning and leasehold requirements; local regulations; and equipment requirements.

7.  Furnishings:  $4,800 to $15,000

  • Figures for furnishings include tables, chairs, and menu board.

8.  Equipment:  $49,187 to $68,656

  • Figures for equipment include smallwares and required Pinkberry Product machines. These figures do not include Information Systems.

9.  Inventory:  $10,204 to $46,503

  • Figures for inventory assume an opening inventory and replenishment for the first 30 days of operation and include food stuffs, plastic and paper goods, menus, apparel, etc., which may have COD requirements if you do not meet certain criteria.
  • The amount you pay will vary depending upon the amount of products you order, your staff size, and business volume.

10.  Utility Deposits and Fees:  $0 to $3,000

  • The figures provided for utility deposits do not include any special connection and/or tap fees, EDD or sales taxes, which are based upon projected sales.

11.  Business License:  $300 to $600

  • You may also have to obtain a license to do business in the city or country where you conduct business; this will depend upon your local ordinances.

12.  Insurance:  $2,000 to $3,000

13.  Grand Opening:  $5,000

14.  On-Site Opening Assistance:  $7,470 to $9,470

15.  Catering/Delivery Service:  $0 to $7,500

  • You may elect, but are not required, to provide catering or delivery services. The suggested list of initial supplies includes plates, insulated containers, dollies, trays, ice packs, totebags, topping bowl, fruit bowl, and table top chiller and currently costs $2,996.40.
  • Additional amounts may be required to obtain a vehicle for providing such services. Pinkberry does not currently have required vehicle specifications.

16.  Information Systems:  $20,991 to $31,533

  • “Information Systems” includes all electronic based hardware, software, middleware, web-based solutions, wireless, electronic interfaces, cabling, and other electronic devices, including computer systems, data systems, network systems, printer systems, internet systems, telecommunication systems, menu systems, security systems, digital media systems, video and still digital cameras, power systems, music systems, and required service and support systems and programs.
  • “POS System” means the point-of-sale and cash collection systems.
  • This figure includes costs for two POS System terminals, and associated printers and cash drawers, point-of-sale software, point-of-sale help desk phone support, polling and reporting, food cost and labor system, back-office computer system and Office software, back-office printer, camera and security systems, managed anti-virus software, remote control software, and system and patch management.
  • This figure also includes the cost of an amplifier and the required music subscription services.
  • Pinkberry has not included the cost of any required hardware and software maintenance agreements. This figure also does not include any technical support costs associated with operating the hardware or software.
  • You must obtain a high-speed communications connection (such as DSL or cable internet connection services). You may be required to upgrade to a T-1 line under certain circumstances. Your initial investment will depend on your location, and any modifications needed for hook up and installation.

17.  Telephone:  $150 to $300

18.  Signage:  $7,000 to $32,533

  • Two exterior signs may be required and are included in these figures.

19.  Legal and Accounting:  $2,500 to $10,000

20.  Additional Funds – 3 Months:  $25,000 to $75,000

  • Additional Funds is an estimate of certain funds needed to cover business (not personal) expenses during the first 3 months of operation of your business. You will need capital to support on-going costs of your business, such as payroll, utilities, taxes, loan payments, and other expenses, if revenues do not cover business costs.

21.  Total:  $310,442 to $628,995

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