This post was updated on May 30, 2017 to reflect information from Two Men and a Truck’s 2017 FDD (Item 7).
Detailed Estimates of Two Men and a Truck Franchise Costs Based on Item 7 (Estimated Initial Investment) of Two Men and a Truck’s 2017 Franchise Disclosure Document
1. Initial Franchise Fee: $50,000 to $85,000
- The initial franchise fee may be more than $50,000 for some areas.
- The initial franchise fee is $85,000 for a new franchisee purchasing an area where the franchise has had a prior presence.
2. First Month’s Rent and Security Deposit: $2,400 to $28,000
- You will need at least 1,000 square feet of office space to operate a Two Men and a Truck franchise. You must also have space available to park your trucks on site or within a reasonable proximity to your site, as approved by the franchisor. The franchisor estimates that your rent will be between $1,200 and $14,000 a month, depending on the size, condition, and location of the leased premises.
- The franchisor estimates that your security deposit will be equal to one or two months’ rent.
3. Miscellaneous Start-up Expense: $23,000 to $42,000
- Miscellaneous start-up expenses include computer hardware (office, truck, and training), telephone installation, telephone deposit, copier, initial inventory of boxes, boards (bulletin or white board), minimum initial advertising campaign, supplies, miscellaneous moving equipment, and other miscellaneous expenses.
- The franchisor may impose additional computer hardware requirements for some franchisees depending on the franchisee’s experience, the demographics of the Marketing Area, the density of the population, whether the area is a metro area, and other reasonable factors determined by the franchisor. The cost of these additional requirements is reflected in the high end of the estimate.
4. Insurance and Risk Management: $25,000 to $43,000
- The franchisor currently requires that you carry the following insurance policies, with the coverage and amounts described, as a minimum: commercial general liability insurance coverage; motor vehicle liability coverage; cargo insurance; umbrella policy; business personal property insurance; employee dishonesty insurance; workers’ compensation coverage; employment practices liability insurance and third party discrimination liability coverage; and all other insurance coverage required by the law where the franchisee is located or that the franchisor otherwise requires.
5. Licensing Requirements: $500 to $80,000
- You must satisfy all requirements of applicable law for operating a Two Men and a Truck franchise business within the state and area for which you intend to operate. The requirements for legally operating a moving company vary greatly. These requirements may include obtaining a business license from local authorities and/or an authority from the applicable state or federal agency.
- You may incur legal fees to acquire your authority. While a particular jurisdiction may not require any authority for local moves, generally any moves across state lines require an authority. You should review the legal requirements for operating in the area in which you anticipate you will be licensed and obtain an estimate of the costs you will incur before you enter into the Franchise Agreement.
6. Legal and Accounting Fees: $1,000 to $2,000
- You should have your attorney and accountant review all of the franchise documents and advise you on the purchase, development, and operation of the franchise.
7. 2 to 3 Trucks: $50,000 to $270,000
- You will be required to own or lease two or three trucks at start up. You may also be required to obtain a specified number of additional trucks within a specified time period after opening. The actual number of initial trucks and any required additional trucks will be specified and agreed to before signing the Franchise Agreement.
- These requirements may vary based on the franchisee’s experience, the demographics of the Marketing Area, the density of the population, whether the area is a metro area, and other reasonable factors determined by the franchisor.
- Used trucks generally cost between $15,000 and $60,000 each. New trucks generally cost between $45,000 and $95,000 each.
- Trucks must meet the franchisor’s specifications for appearance.
- Many franchisees finance or lease their trucks. If you finance the trucks, the franchisor estimates that you will be required to pay approximately 10% down (between $15,000 and $30,000 for three trucks) and should be able to finance the balance over a four to six year period.
- Your monthly payments will vary depending on the cost of the trucks, the time period of the financing, and the interest rate. If you lease the trucks, your down payment and monthly payments will probably be less.
8. Office/Mobile Technology Costs: $15,000 to $20,000
- Office/mobile technology start-up costs include the cost for computers, tablets, internet, and firewall services.
9. Initial Marketing Expenses: $20,000 to $40,000
- You must prepare an initial sales and marketing plan and budget for your business. The budget is an estimate of the expenses you will incur in connection with the initial sales and marketing plan, which must be approved by the franchisor.
10. Additional Funds – 3 Months: $20,000 to $50,000
- This is an estimate of the expenses you will incur during the three-month initial phase of operations. These expenses include royalty, Advertising Fund, and Technology and Support Fee payments; insurance premiums; local advertising; additional supplies; and payroll costs.
- These are estimates and the franchisor cannot guarantee that you will not have additional expenses starting your franchise.
11. Pre-Opening Training Costs: $2,500 to $6,000
12. Total Estimated Initial Investment (for a new franchisee purchasing an area where the company has had no prior presence): $209,400 to $631,000
Total Estimated Initial Investment (for a new franchisee purchasing an area where the company has had a presence): $244,400 to $666,000