Detailed Estimates of French Fry Heaven Franchise Costs Based on Item 7 (Estimated Initial Investment) of French Fry Heaven’s 2013 Franchise Disclosure Document

1.  Initial Franchise Fee:  $25,000

2.  Training Expenses:  $1,000 to $2,000

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  The estimate includes the travel, food, and lodging expenses of one to two people to attend the initial training course in Jacksonville, Florida; St. Augustine, Florida; or at your French Fry Heaven Business as required by your Franchise Agreement.

• The company estimates that the training course will be for two days.

3.  Lease:  $700 to $12,000

• The company estimates that your French Fry Heaven Business will require 100 to 187 square feet of space for a kiosk and 800 square feet of space for an inline or standalone location.

4.  Equipment, Fixtures, Construction, Remodeling, Leasehold Improvements, and Decorating Costs for Leased Premises:  $85,000 to $214,000

• This estimate includes costs of construction, remodeling, painting, and assumes that basic plumbing and electrical exists in the premises. Installation of plumbing and electrical systems will increase your cost by at least $15,000.

• The estimate above is for an inline location. A standalone location will likely cost more to build.

• You must purchase fixtures, furnishings, and equipment for your French Fry Heaven Business. This estimate includes the costs of outside tables and chairs, lighting fixtures, shelving and countertops, three-compartment sink, dry storage closet, storage freezer, fry machines, point-of-sale computer system, smallwares, oil filter, cleaning supplies (mops, cleaning equipment, brooms), and other equipment.

• The figures above reflect the estimated cost of interior and exterior signage required under the company’s standards, specifications, and requirements.

• If you will operate the French Fry Heaven Business from a kiosk or cart, you must purchase a pre-fabricated kiosk or cart, which will include all required equipment and installation, or hire a general contractor to build the kiosk or cart to the company’s specifications. The cost of a kiosk or cart is approximately $62,000 (including equipment).

• You may also need to make special arrangements under local laws or regulations to have access to utilities required to operate a kiosk.

5.  Opening Inventory:  $2,000 to $4,000

• You must purchase an initial inventory of products before the French Fry Heaven Business opens for the first time, including sauces, french fries, cones, paper and plastic food and beverage serving items (such as cups, plates, and utensils), drink concentrate, stickers, and flyers.

6.  Security Deposits, Utility Deposits, Business Licenses, and Other Prepaid Expenses:  $6,700 to $11,700

• Prior to the opening of your French Fry Heaven Business, you must obtain all necessary permits and licenses. The above estimate includes building permits, certificates of occupancy, and certificates of health.

• The estimate does not include a security deposit or the costs of deposits for gas and electric service that you will need to operate your French Fry Heaven Business.

• Within 60 days after the initial opening of your French Fry Heaven Business, you must spend an amount the franchisor determines, which will not exceed $7,000, on grand opening local advertising and promotion, as the franchisor directs. You are expected to spend this amount in accordance with the marketing plan the franchisor prescribes.

• In addition, within said 60 days, you must purchase a “Festival” package consisting of equipment necessary to offer and sell French Fry Heaven Products and other products approved by the franchisor at temporary fairs, festivals, carnivals, and other similar events.

• Before you open your French Fry Heaven Business, you must purchase the insurance coverage required by the Franchise Agreement. The franchisor anticipates that you will be required to pay your insurance carrier or agent a full annual premium in advance. The estimate provided above is for a full annual premium.

7.  Additional Fund for First 3 Months:  $2,500 to $30,000

• The franchisor estimates that the amount specified above will be necessary during the first 3 months of the operation of your French Fry Heaven Business. The company has relied on the expenditures paid by, and the experience of, its affiliate’s French Fry Heaven Business in determining this estimate.

8.  Total:  $117,900 to $298,700

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