Updated September 6, 2021.
Detailed Estimates of Capriotti’s Franchise Costs Based on Item 7 (Estimated Initial Investment) of Capriotti’s 2021 Franchise Disclosure Document
- There are no other direct or indirect payments regarding the purchase of the franchise.
- All figures in this table are estimates only. Actual costs will vary for each franchise and each location depending on a number of factors.
1. Franchise Fee: $40,000
- The initial franchise fee under each Franchise Agreement is a lump sum payment of $40,000. The initial franchise fee for each Restaurant slated for development under an Area Development Agreement is $30,000.
2. Development Services Fee: $6,000
- This fee is payable when you sign the Franchise Agreement for the franchisor’s costs incurred in providing site selection, layout, and design assistance.
- However, if you sign an Area Development Agreement, this fee for the first Restaurant you agree to develop is due when you sign the Area Development Agreement.
3. Architectural/Engineering Fees and Project Management: $15,000 to $28,500
- This fee represents the cost of plans and specifications paid to an approved kitchen designer, architect, and engineer.
- The franchisor may require you to use an approved construction management firm to manage the construction process for your location.
- The cost for the development of construction documents can vary depending on the state or municipality where your Restaurant will be built.
4. Professional Services: $2,000 to $5,000
- Professional fees are for attorneys, accountants, or other professionals from whom you seek advice.
5. Permits and Licensing: $3,000 to $17,000
- Permits and licensing are fees paid to various local agencies to secure permits related to constructing your leasehold space.
6. Rent: Amount Not Specified
- A Restaurant occupies approximately 1,400 to 1,600 square feet of leased space, typically in an in-line shopping center in an urban or suburban commercial center.
- While there are exceptions depending on landlord negotiations, Capriotti’s franchisees typically do not pay rent before they open for business.
7. Security Deposits: $3,100 to $15,000
- Landlords typically charge a security deposit equal to 1 month’s rent and also may have site lease deposits that vary according to location. Utility and other companies typically charge security deposits that vary by locale and your credit history.
8. Leasehold Improvements: $142,000 to $250,000
- The high and the low amount reflect estimated leasehold improvement costs without any tenant improvement allowances but do include a 10% contingency (of the total estimated cost) for unexpected cost over-runs or delays.
9. Furniture, Fixtures, Equipment, and Smallwares: $100,000 to $140,000
- The high and low amounts represent the price to buy new equipment. This range includes the purchase of audio-visual equipment.
10. Interior Décor: $4,000 to $13,000
11. Exterior Signage: $5,000 to $17,000
12. Menu Boards: $800 to $1,500
13. POS System: $6,200 to $20,000
- This represents the cost for the fully-integrated required point-of-sale (POS) system with the franchisor’s required suite of services.
- The low end represents franchisees that have chosen to use the leasing program offered by the POS vendor.
14. Training: $15,000
- This represents the training costs for your first Restaurant.
- You do not pay an initial training fee, but you will pay all personal expenses for the training for you and your employees, including transportation to Las Vegas, lodging, meals, wages, and benefits for you and any of your employees during the Pre-Opening Mock Operations.
- This amount is the estimated cost for 4 people to attend the franchisor’s training program.
15. Opening Inventory: $7,000 to $10,000
16. Shop Launch Marketing Plan: $30,000
- You must spend at least $30,000 on Shop Launch Marketing activities. The Shop Launch Marketing Plan typically covers a 4 to 6-month period.
- The franchisor will make the spend on your behalf.
- You must pay the franchisor $15,000 4 weeks before the Restaurant opens and another $15,000 within 10 weeks after the Restaurant opens.
- Some franchisees have chosen to spend significantly more than $30,000 towards their shop launch marketing and advertising activities.
17. Pre-Opening Mock Operations: $3,000
- All Restaurants must have at least 2 Pre-Opening Mock Operation and staff training events, commonly called a friends and family night. For the friends and family night, the franchisor estimates food costs of $1,500 and approximately 200 salary hours for 3 days of employee pre-opening training.
18. Insurance (3 months): $1,000 to $2,000
- You must purchase insurance the franchisor specifies.
19. Additional Funds (3 months): $30,000 to $40,000
- This is an estimate of the range of initial start-up expenses for 3 months for which you might need additional capital.
20. Total (excluding real estate purchase and lease costs): $413,100 to $653,000
- The outlined investment is for a Capriotti’s Restaurant at a traditional location.
- If you open a Restaurant in a non-traditional location, such as a regional shopping mall, enclosed shopping mall, lifestyle center, airport, university, sports arena, virtual kitchen, or a location that operates on a delivery and/or pick-up-only basis, the cost could be significantly lower or potentially higher depending upon the location, the required equipment, design, the use of union labor, and facilities fees paid to the location owner.
- A lower-cost Restaurant is one that will require fewer leasehold improvements, less seating, and fewer equipment purchases. Moderate and higher-cost Restaurants may require extensive interior and exterior renovations, interior finishes, and additional equipment.
- To avoid excessive construction costs, the franchisor strongly recommends that you choose contractors carefully by obtaining several competitive bids before construction begins.
- In compiling these figures, the franchisor has relied on its experience and that of its subsidiaries in operating Capriotti’s Restaurants for many years.