Detailed Estimates of Sit Means Sit Franchise Costs Based on Item 7 (Estimated Initial Investment) of Sit Means Sit’s 2014 Franchise Disclosure Document

• The franchise offered is for the operation of a dog training business using the “Sit Means Sit” system and standards.

1.  Initial Fee:  $15,000

• The franchisor may agree to finance all or part of this amount.

2.  Real Property and Leasehold Improvements:  $0 to $15,000

• The low estimate assumes that you will operate out of your residence without a formal Training Facility, so you will incur no rental charges or construction costs.

• If you do operate from a separate facility, locations might include strip malls or light industrial or commercial zones in which you will typically lease unimproved and unfurnished retail store front or warehouse space.

• For a leased Training Facility, you can expect to prepay first and last months’ rent (which Sit Means Sit estimates will total about $6,000) and spend an additional $6,000 to $9,000 to construct and improve the space before opening. These figures are represented in the high estimate and based on a facility ranging in size from 1,000 square feet to 3,500 square feet in Las Vegas, Nevada.

• However, rent can vary widely and is dependent upon factors such as size, location, demand, general economic conditions of the town or city in which your Training Facility is located, the condition of the premises, and lease negotiation rent reductions.

• The amount for real estate improvements will depend upon the size of the space, the condition of the premises, landlord construction allowances, the cost of hiring any necessary subcontractors, and costs of materials. This amount also may include the purchase of heating, ventilating, and/or air conditioning systems for the Business.

3.  Equipment, Supplies, Materials, and Signs:  $300 to $1,000

4.  Sit Means Sit Vehicles:  $400 to $23,500

• You must purchase or lease one or more Vehicles meeting Sit Means Sit’s policies and specifications.

• The low estimate assumes that you already own a suitable vehicle and use minor decaling.

• Promptly following the lease of your Vehicle(s), you must make certain modifications and additions to the Vehicle(s) as Sit Means Sit requires, including installing decals, logos, and racks.

5.  Computer Hardware and Software:  $900 to $5,000

6.  Initial Training Fee:  $0 to $2,500

• Sit Means Sit will train one person at no additional charge (excluding a transferee).

• The low estimate assumes you will only have one trainee, and will incur no additional charge for training, and the high estimate contemplates the Initial Training Fee for a second trainee.

• You must pay an Initial Training Fee of $2,500 for the second and each additional person to attend the Initial Training Program (all transferees will pay these amounts). For the second and each additional person you bring to training, you must also pay Sit Means Sit a housing fee of $45 per day for each day that person attends training.

7.  Wages, Travel, and Living Expenses During Training:  $620 to $3,680

• You must pay the expenses of all persons attending the Initial Training Program including transportation.

• The low estimate assumes travel-related costs to train one person for 21 days in Las Vegas, Nevada and that you are within driving distance and incur $200 for gas.

• The high estimate assumes two persons and that they will travel by air and incur $1,000 in airfare, meals, and wages.

8.  Opening Inventory Collars:  $630 to $1,570

9.  Pre-Opening Advertising (includes brochures, business cards, magnets):  $200 to $700

10.  Insurance Deposits and Premiums:  $150 to $3,300

• This is an estimated down payment against the annual premiums you must pay for the insurance required under the License Agreement and Manuals. This estimate is for workers’ compensation, errors and omissions, automobile, and comprehensive general liability insurance.

• The exact dollar amount of your insurance payment will be determined by the geographic location of the Business and the number of employees you are covering.

11.  Licenses and Permits:  $25 to $700

12.  Professional Fees:  $0 to $3,000

13.  Demonstration Dog:  $50 to $7,500

• Sit Means Sit requires you to have a “demonstration dog,” trained with the company’s methods, for use in marketing your business. The range reflected above contemplates your either paying adoption fees for a dog, which are generally around $50, or your buying a dog for your business, which can be as much as $7,500.

14.  Additional Funds – 3 Months:  $2,400 to $11,400

• These amounts are the minimum recommended levels to cover your operating expenses for three months, assuming no revenue during this period. They cover monthly telephone charges, Sit Means Sit’s minimum fees, and fuel for your vehicle to conduct marketing.

• Because Sit Means Sit does not expect most licensees to lease a formal Training Facility, the low figure does not include rent. If you do rent a facility, you should expect approximately an additional $9,000 for 3 months rent (which is included in the high estimate).

• These figures do not include any provision for your salary or living expenses, nor do they contemplate that you will hire a separate trainer or incur other employee wages.

• Sit Means Sit does not generally suggest paid media advertising, so these estimates do not contemplate media advertising.

15.  Total Estimated Initial Investment:  $21,125 to $93,850

• These figures are estimates and Sit Means Sit cannot guarantee that you will not have additional expenses starting the Business.