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Earnings Claims of Top Franchises Revealed

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Franchise Costs: Detailed Estimates of Steak Escape Franchise Costs (2016 FDD)

by Franchise Chatter on May 23, 2014

in Franchise Costs, Sandwich Franchise



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Steak Escape 2

This post was updated on June 8, 2016 to reflect information from Steak Escape’s 2016 FDD (Item 7).

Detailed Estimates of Steak Escape Franchise Costs Based on Item 7 (Estimated Initial Investment) of Steak Escape’s 2016 Franchise Disclosure Document

1.  Initial Franchise Fee:  $17,500 to $35,000

2.  Initial Training Expenses:  $1,000 to $4,000

  • The expenses include the travel and certain living costs of you or your personnel participating in Steak Escape’s training. Travel expenses will, by necessity, vary depending upon where you or your participating personnel are located.
  • Steak Escape will provide your personnel’s hotel accommodations during initial required training, subject to its then current expense policies.

3.  Initial Inventory of Food, Paper Products, and Miscellaneous Supplies:  $4,000 to $5,000

4.  Space Lease (Security Deposit and First Three Months’ Rent):  Varies

  • A typical in-line strip center restaurant is between 1,000 and 2,000 square feet. Your rent will vary depending on such factors as the actual square footage, condition, desirability of the location, and overall condition and requirements of the center.

5.  Construction and Leasehold Improvements:  $10,000 to $268,000

  • The estimate given is for a 1,300 square foot leased location and may not be relevant to other types of locations.
  • Factors that may significantly affect the costs of leasehold improvements include (a) the condition of the existing space; (b) the nature of the previous tenant, if any; (c) the configuration of the space; (d) local code requirements; and (e) the geographic location of the restaurant.
  • This estimate does not include any site improvements, i.e. parking lot paving, lights, trash enclosure, landscaping, or any addition to the existing building.

6.  Furniture, Fixtures, and Equipment:  $77,000 to $140,000

  • This estimate covers the cost of standard kitchen equipment, furniture, and fixtures, other than an exhaust package. The estimate may not cover all equipment required by law, local regulations, or your lease, if leasing. Additional equipment may be required resulting in substantial additional costs to you.
  • The estimate does not include the cost of transporting equipment from the supplier to the restaurant. The cost of transportation will vary with the distance over which equipment must be shipped, the method of shipping, the weight of equipment, and other factors, and cannot be estimated with accuracy.

7.  Signs and Graphics:  $5,000 to $25,000

  • This estimate covers the cost of exterior signs. Actual costs may vary depending on landlord requirements and local sign ordinances regarding the size and permitted use of certain signs.

8.  POS System:  $4,000 to $10,000

  • In addition to the POS system and related equipment, there may also be related software, licensing, service, and other fees of $20 to $300 per month, depending upon services elected or required, plus any technical service fees if you require additional technical assistance.

9.  Lease Negotiation Legal Expenses:  Varies

10.  Architectural Services:  $4,000 to $30,000

  • This estimate covers your cost of securing architectural and/or engineering services to convert Steak Escape’s design drawings into construction plans suitable for permitting and securing construction cost estimates for your restaurant. The amount may vary from region to region, depending on local building codes and ordinances.

11.  Insurance:  $750 to $2,000

12.  Uniforms:  $1,000 to $2,000

13.  Advertising:  $2,000 to $6,000

  • You must spend a minimum amount on advertising, based on your Gross Sales. This estimate does not reflect such minimum requirement but the actual amount anticipated.

14.  Utility Deposits, Business Licenses, and Prepaid Expenses:  $2,000 to $4,000

15.  Additional Funds – 3 Months:  $20,000 to $30,000

  • These expenses include payroll costs but do not include rent, which varies too greatly to be estimated with any accuracy, nor royalty fees or marketing fund fees payable to Steak Escape since those are dependent upon Gross Sales, which Steak Escape cannot predict.
  • Steak Escape has based its estimate of necessary additional funds on the experience of its affiliates which own and operate restaurants and also on the experience of its franchisees.

16.  Total:  $148,250 to $561,000

  • These figures are estimates and Steak Escape cannot guarantee that you will not have additional expenses.



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