Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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Franchise Costs 2013: Detailed Estimates of Expedia CruiseShipCenters Franchise Costs (2013 FDD)

by Franchise Chatter on December 16, 2013

in Franchise Costs, Travel Franchise

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Detailed Estimates of Expedia CruiseShipCenters Franchise Costs Based on Item 7 (Estimated Initial Investment) of Expedia CruiseShipCenters’ 2013 Franchise Disclosure Document

1.  Initial Franchise Fee:  $29,000

  • Your initial franchise fee will be $29,000 unless your Travel Business is located in a Small Market, in which case your initial franchise fee will be $14,500.

Cruise Photo by nydiscovery72.  On-Site Training – Your Transportation and Accommodation:  $1,000 to $1,500

  • The franchisor provides initial training for you at no additional cost, including lunch meals while on site. Other meals, hotel, and transportation, including airfare, automobile, and transfers, are at your cost. You are required to book your own transportation and accommodation.
  • Transportation and accommodation amounts are for one person.

3.  On-Site Training – Additional Trainee:  $0 to $495

4.  On-Site Training – Additional Trainee Transportation and Accommodation:  $0 to $1,500

5.  Lease and Security Deposit:  $8,000 to $12,000

  • Rent can vary significantly by site location and size (the franchisor requires the location of the Travel Business to be at least 800 square feet). Three months’ rent and a one month security deposit are included in these estimates.
  • If you own your own business premises, the franchisor cannot estimate or anticipate what, if any, additional investment may be required. The costs of ownership may differ from the rent-based amounts included in these estimates.

6.  Utilities/Telephone/Internet Service:  $1,500 to $2,000

  • These estimates do not include monthly fees for additional services, such as cellular service.

7.  Office Furniture, Equipment, and Office Supplies:  $9,500 to $15,000

  • The amount you spend on office furniture, equipment, and supplies will vary based on the quality of office equipment and supplies you select and whether you already own these items.

8.  Leasehold Improvements and Signage:  $12,000 to $50,000

  • Leasehold improvement expenses will vary significantly depending on the size of your location, the market for materials and labor in your area, and arrangements with your landlord on who is responsible for improvements.

9.  Computers and Software:  $3,000 to $7,000

  • Franchisees must have at least 3 to 5 computers and software that meet the franchisor’s requirements. The amount you must spend on computers and software will vary based on the type of computers and software you already have, if any.
  • The high range of the estimate assumes that you purchase new computers and all required software, with specifications greater that what the franchisor requires at a minimum.

10.  Insurance:  $700 to $1,000

  • The franchisor requires you to maintain a certain minimum level of errors and omissions and general liability insurance coverages for your Travel Business.

11.  Professional Fees:  $1,000 to $3,000

  • You should consult with a professional, such as an attorney and/or accountant before you decide to invest in a Travel Business. The costs associated with these consultations can vary based on the particular professional and the scope of their review and assistance.

12.  Business License and/or Permits:  $500 to $2,500

  • Depending on where you are located, you may be required to obtain a “seller of travel” permit (which may require you to post a bond or provide other financial security) and other business licenses and/or permits. The amount of any such security or costs related to arranging required financial security is in addition to the amounts presented above.
  • You should consult with an attorney regarding any obligation you may have to obtain such business licenses and/or permits and the expected costs, if any.

13.  Additional Funds Working Capital for the First 12 Months:  $36,400 to $55,000

  • Additional funds may be necessary to cover your cost of living and other expenses during the first 12 months, or longer, of operating your Travel Business. Your actual living expenses may be more or less than the average living expenses of new franchisees.
  • This estimate assumes you will receive no income from your Travel Business during the first 3 months of operating your Travel Business.
  • The franchisor relied on its prior experience and recent performance of its existing franchisees to compile these estimates, and although these estimates are based on the franchisor’s current expectations and financial, economic, and competitive data currently available, these estimates are inherently uncertain.

14.  Total Estimated Initial Investment:  $102,600 to $179,995

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