Waxing the City Franchise Costs: Estimated Initial Investment (Item 7, 2022 FDD)
- The high and low ranges in the table are based on a 6 treatment room Waxing Studio.
- These estimates assume you will build out your studio space for 6 rooms and that you initially order equipment, furniture, and supplies for 6 treatment rooms.
- These fees are non-refundable unless otherwise noted.
1. Initial Franchise Fee: $42,500
- If you sign an Area Development Agreement, you must commit to opening more than one Waxing Studio, and you will pay the Development Fee at the time you sign the Area Development Agreement.
- The Development Fee replaces the Initial Franchise Fee you would have paid for those Studios.
2. Travel and Living Expenses While Training: $1,650 to $2,350
- The person you designate as the “Principal Operator” of your Waxing Studio must attend mandatory training in a virtual format or at a location(s) Waxing the City designates. Waxing the City also may require the Principal Operator and/or a Principal Owner to spend up to 5 days training in an existing Waxing Studio owned by Waxing the City or an existing franchisee.
- If your Principal Operator is not also a Principal Owner, then this individual must attend the training, and a Principal Owner must also attend and complete this training to Waxing the City’s satisfaction before you open your Waxing Studio.
- While Waxing the City does not currently charge for this training, if applicable, you must pay all travel and living expenses for your attendees.
- Waxing the City will also provide resources and support so that you can provide Initial Cerology Training (also referred to as “Cerologist CORE Training”) for each of your aestheticians in a virtual format, at your location, or at another location that Waxing the City designates, at its discretion, before you open for business. There currently is no fee for this support if provided in a virtual format, however, if applicable, you must pay all travel and living expenses for your attendees.
- Your costs will differ if your aestheticians attend Initial Cerology Training at a location other than your location or in a virtual format.
3. Deposit and Leasehold Improvements: $4,816 to $225,066
- The estimate for initial expenses for real estate and improvements assumes you will lease space for your Waxing Studio. Waxing Studios are generally located in commercial retail areas. The typical size of a Waxing Studio is approximately 1,800 square feet. The cost for build-out is approximately $125 per square foot, which, at a minimum, includes rooms that will work as waxing treatment rooms, concrete floors, demised exterior walls, HVAC, roof, and utilities stubbed to the premises sufficient for a Waxing Studio.
- The high estimate assumes you will pay for the full build-out without receiving any tenant improvement allowance from your landlord. The low estimate assumes that your landlord pays for the full build-out cost for your Waxing Studio. However, there is no assurance your landlord will agree to do so.
- Most of Waxing the City’s franchisees receive some tenant improvement allowance from their landlord (the average amount received by franchisees in Waxing the City’s system in 2021 was $25.53 per square foot).
- Waxing the City’s estimate assumes you must only pay one month of rent as a security deposit.
- This estimate also includes 3 months of base rent at $26.07 per sf and $6.73 per sf in CAM (which are the average base rent and CAM figures for all studios in Waxing the City’s system for 2021) for a studio that is 1,762 sf, which is the average size of all studios in Waxing the City’s system in 2021.
- The amount of your leasehold improvements will likely vary substantially based on existing conditions, size, and design, including the availability and prices of labor and materials.
- The amounts do not include the costs of any necessary site development or site engineering work, nor do they include capitalized costs of rent or other occupancy costs, over either the life of the lease or the life of your investment.
- In addition, these amounts do not reflect costs for the purchase of unimproved land and construction of a free-standing Waxing Studio, which also would result in a significantly greater initial investment.
- In addition, Waxing the City assumed the general contractor will include permitting fees in the construction costs.
4. 3 Months’ Rent: $14,500
5. Architect/Design Fees: $6,000 to $15,550
- You will be required to retain an architectural vendor to create a complete set of detailed Construction Documents. Waxing the City does not construct, remodel, or decorate your premises.
- The estimates assume standard tenant improvements within a structure, designed for commercial use, and excludes items such as structural modifications, site work, energy studies, surveys, and/or exterior improvements.
- The high estimate assumes you use your own architect and must pay Waxing the City the fees above.
6. Furniture, Fixtures, and Equipment: $36,000 to $46,700
- This estimate is for the total cost to purchase furniture, fixtures, and equipment for the reception area, common areas, 6 waxing treatment rooms, and the employee break room.
7. Office Supplies: $3,500 to $4,500
- This estimate includes costs for the purchase of office and cleaning equipment and supplies.
8. Technology Package and Licenses: $10,419 to $22,452
- The low end of the range for this estimate assumes you purchase the minimum required technology package offered by ProVision, and the high end of the range assumes you purchase the larger package with additional items through ProVision.
- These figures include costs for shipping, installation, and taxes. Your costs may vary if you purchase the required technology from a third-party vendor.
9. Interior and Exterior Signage: $16,000 to $20,100
- The total cost for the signage varies depending on the size of the signs, quantity, whether the signs are illuminated, and the requirements of the landlord and governing authority.
10. Initial Retail Inventory: $4,500 to $5,500
- Your initial inventory of retail products for sale in your Waxing Studio, body waxing and service offering supplies will include branded products for retail sale, wax, applicators, gloves, linens, and other supplies and products as described in the Operations Manual. Waxing the City has the right to change the inventory requirements at any time.
- Studios can expect to spend on average approximately $1,100 per month on waxing supplies during the start-up phase of business and approximately $4,000 per month after the start-up phase.
- Studios can expect to spend on average approximately $1,000 per month on retail products during the start-up phase and approximately $2,000 per month after the start-up phase.
11. Initial Waxing Supply Inventory: $6,000 to $7,000
12. Grand Opening Advertising: $25,000
- The estimate assumes you spend the $25,000 that Waxing the City requires you spend to advertise your Waxing Studio for the Grand Opening and Ramp Up Plan. This amount includes your purchase of grand opening marketing materials such as postcards, posters, and brochures as well as additional marketing materials, like branded promotional products, printed materials, large format indoor or outdoor signage for tradeshows, and similar items, which you may purchase through Waxing the City’s marketing portal. You may spend more than this amount.
- Factors that may affect the actual amount you spend include the type of media used, the location of your Waxing Studio, the size of the area you are advertising to, local media cost, and the time of year.
- You will not pay these amounts to Waxing the City but it may require you to submit receipts to verify you met this requirement. If you fail to meet this requirement, Waxing the City may require you to pay the difference into the General Advertising and Marketing Fund.
13. Insurance: $2,550 to $2,850
14. Miscellaneous Expenses: $6,670 to $7,500
- These estimates include utility costs for 3 months, licensing fees, criminal background checks, and uniforms for 6 initial employees, plus licensing and permitting fees and professional expenses such as legal and accounting.
- These costs can vary significantly depending on the location of the Waxing Studio and how many initial employees you have.
15. Additional Funds and Working Capital for First 3 Months: $43,860 to $51,860
- This amount includes estimated operating expenses you should expect to incur during the first 3 months of operations, not including any revenue generated by your Waxing Studio. These figures include monthly royalties, general advertising fund fees, and technology fees. This estimate does not include any taxes or other permitting or licensing fees that you may pay.
- The estimates also assume you pay credit card processing fees of 2% on your gross revenues, and that you pay wages and payroll for 4 Cerologists and for 1 Waxing Studio Coordinator working part-time. These estimates do not include payroll taxes or benefits.
- Some of Waxing the City’s studios also pay their Cerologists commission on product sales. It is up to you to determine how to pay your employees.
16. Total: $223,965 to $493,428
- Waxing the City has relied on its experience in operating company-owned Waxing Studios in the Minneapolis-St. Paul metropolitan area, and the experience of the franchised locations in various states to compile these estimates.