This post was updated on August 27, 2017 to reflect information from Haagen-Dazs’s 2017 FDD (Item 7).
Detailed Estimates of Haagen-Dazs Franchise Costs Based on Item 7 (Estimated Initial Investment) of Haagen-Dazs’s 2017 Franchise Disclosure Document
For a New Shop or Satellite
1. Initial Franchise Fee: $15,000 for existing franchisees; $20,000 for experienced operators who satisfy the requirements of the Experienced Operator Discount Program; or $30,000 for new franchisees, in the case of a franchise for a new Shop
- The Franchise Agreement must be signed 90 days prior to the expiration of your current Franchise Agreement, unless a shorter time period is allowed by Haagen-Dazs.
- The fee for a successive term is $10,000 for a term of 10 years, and is not refundable. The fee for a renewal term is from $0 to $5,000, based on a formula in your expiring Franchise Agreement, and is not refundable.
2. Satellite Fee: $1,000 in the case of an existing franchisee being granted a Satellite Agreement in connection with an existing Shop
3. Travel and Living Expenses to Attend Application Interview: $0 to $1,159
- Assumes 1 person, 1 night of lodging at $119/night, 1 day of food costs at $40/day, and round-trip air fare at $1,000. Actual costs will vary considerably depending upon location of travel origin, and number of persons.
- This expense will be incurred even if your Franchise Application is not accepted by Haagen-Dazs.
- Existing franchisees are normally not required to attend an interview. Haagen-Dazs may not require an interview in Minneapolis in the case of a Hospitality Shop, if it has a sufficient understanding of your operational experience based on your existing business operations.
4. Travel and Living Expenses During Training: $0 to $2,749
- Assumes 1 person, 11 nights of lodging at $119/night, 11 days of food costs at $40/day, and round-trip air fare at $1,000. Actual costs will vary considerably depending upon location of travel origin, and number of persons.
- This expense will be incurred even if you do not pass training.
- In the case of a Hospitality Shop, training may take place at the Hospitality Shop itself.
5. Leasehold Improvements: $55,000 to $300,000
- Franchisees’ expenditures for real property for Haagen-Dazs Shop premises vary substantially from one Shop location to another and are determined by local market conditions including the Shop’s geographic area, location, improvements, size, utilities, term of lease, negotiating ability of the franchisee, and other competitive or market forces involved in the acquisition or lease of real property.
- New Shops typically range from 200 to 1,800 square feet but are usually approximately 500 to 1,000 square feet in size and are usually located in active shopping areas such as selected locations in regional malls. Shops ordinarily are developed in existing shopping center buildings or in-line locations and rarely are established in free-standing buildings.
- In the case of a Hospitality Shop, the investment range takes into account that you probably already operate within the facility in which the Hospitality Shop will be located.
6. Deposits and Licenses: $7,500 to $17,500
- Security deposits or prepaid expenses are often required in connection with real property leases, personal property leases, utility requirements, insurance requirements, and telephone arrangements.
- Down payments may be required by vendors of equipment, fixtures, and other assets.
- Various permits and licenses are required by governmental regulations on either an isolated or recurring basis. Typical permits include those from health departments, fire departments, food establishment regulatory agencies, labor departments, sales tax bureaus, and other similar governmental agencies.
- Investment range takes into account that, in the case of a Hospitality Shop, you may already have the licenses and permits needed to operate the Hospitality Shop.
7. Equipment, Fixtures, and Furnishings: $50,000 to $115,000
8. Opening Inventory: $6,000 to $10,000
9. Insurance: $1,500 to $2,500
- You are required by the Franchise Agreement to purchase and maintain general liability insurance and product/completed operations insurance in minimum amounts of $1,000,000 aggregate single limit coverage and to maintain other insurance in accordance with state law requirements.
- The cost of other coverage, including your discretionary purchases, varies widely but usually comes to $1,500 to $2,500 per year.
- In the case of a Hospitality Shop, the investment table reflects the possibility that your existing insurance premium would not change in connection with your establishment of a Hospitality Shop.
10. Additional Funds – 3 Months: $10,250 to $63,500
- This estimates expenses, including payment of marketing contributions, royalties, rent and payroll costs, and replenishing of inventory over an initial start-up period of 3 months. These figures are estimates only and Haagen-Dazs does not guarantee that you will not have additional expenses starting the business.
11. Totals: $154,158 to $542,408 for new franchisees; $145,250 to $526,249 for existing franchisees; and $131,250 to $512,249 for satellite
For an Existing Shop Successive Term
- The total estimated initial investment necessary to begin operation of a Haagen-Dazs Existing Shop ranges from $61,750 to $371,249.
For a Hospitality Shop
- The total estimated initial investment necessary to begin operation of a Haagen-Dazs Hospitality Shop ranges from $14,5o0 to $273,659.