This post was updated on December 28, 2016 to reflect information from CruiseOne’s 2016 FDD (Item 7).
Detailed Estimates of CruiseOne Franchise Costs Based on Item 7 (Estimated Initial Investment) of CruiseOne’s 2016 Franchise Disclosure Document
- All fees payable to the franchisor are uniform and non-refundable. Whether fees payable to third parties are refundable is a matter you will have to discuss and negotiate with them.
- The Franchise Business is usually operated from the franchisee’s home. Accordingly, if you work from home, you will not incur lease and related expenses.
1. Initial Franchise Fee: $495 for Level 3 Franchisee; $3,195 for Level 2 Franchisee; $9,800 for Level 1 Franchisee
- CruiseOne’s determination of what level franchisee you are is based on your prior experience in the cruise travel industry (including the amount of your commissionable sailed revenues in the 12 months before you submit your franchise application).
- Level 1 franchisees need no prior experience in the cruise industry or if they have experience, have less than $100,000 annual commissionable departed revenues (which need not be verified).
- Level 2 franchisees must have verifiable annual commissionable departed revenues of $100,000 to $199,999 and have a current CLIA or IATAN Card.
- Level 3 franchisees must have verifiable annual commissionable departed revenues of $200,000 or more and have a current CLIA or IATAN Card.
- CruiseOne may finance the Initial Franchise Fee for qualified level 1 franchisees. If you qualify, you must pay the franchisor $3,500 toward the Initial Franchise Fee, and issue a promissory note for the balance when you sign the Franchise Agreement and your owners will guaranty the note.
2. Training Expenses: $200 to $250
- This is training for level 1 and 2 franchisees.
3. Additional Signatories/Associates Training and Travel: $0 to $995
- You are responsible for all lodging, food costs, and travel expenses for additional individuals attending initial training. These expenses include a $495 training fee per additional person, plus approximately $550 for food and travel expenses, per additional person.
4. Office Equipment and Training: $0 to $1,500
5. Initial Office Supplies: $50 to $300
- You will need office supplies, including stationery, business cards, forms, and related items.
6. Computer Hardware/Software Equipment: $0 to $2,500
- The Computer System includes the computers and other computer hardware, software, and peripherals and related services (including high-speed Internet service and dedicated telephone lines) that you must purchase, install, and use in accordance with the Operations Standards Manual.
- The expenses listed above will be required only if you do not already have the required computer hardware, software, and related equipment.
7. Insurance, Legal, and Accounting: $150 to $1,000
- You must maintain professional liability insurance coverage (Errors and Omissions insurance) for yourself, your co-owners who work in the business (if any), your general manager, and each sales associate.
- You must obtain and maintain this type of coverage through CruiseOne for an annual charge of $150 per person (subject to change).
8. Permits, Franchises, Bonds, and Memberships: $150 to $500
- As a CruiseOne franchisee, you will automatically become an associated member in professional organizations, including the Cruise Line International Association. You will have to obtain whatever permits and bonds are required under local or state law.
9. Initial Promotion and Advertising: $1,200 to $2,400
- The amount of advertising and promotion you do is discretionary. Advertising expenses may vary significantly in different regions and media markets. Therefore, your advertising and promotional expenses may be greater than the estimate in the table.
10. Criminal and Civil Background Check: $0 to $30
11. Additional Funds (3 Months Initial Phase for Full-Time Franchisees): $1,000 to $2,500
- This is an estimate only of the range of expenses for your initial start-up phase, which is estimated to be 3 months from when you begin operating the Franchise Business. The additional funds you will need to operate during this phase do not include any salary or allowance for an owner’s draw; any royalty fees, advertising contributions, or any other amounts you must pay to CruiseOne.
12. Designated Credit Card: $0 to $75
13. Total: $3,245 to $21,850