Detailed Estimates of CorePower Yoga Franchise Costs Based on Item 7 (Estimated Initial Investment) of CorePower Yoga’s 2014 Franchise Disclosure Document
1. Initial Franchise Fee: $25,000
- The Initial Franchise Fee is $25,000 for each Studio you open. The Initial Franchise Fee is due when you sign the Franchise Agreement and is non-refundable for any reason once paid.
2. Travel and Living Expenses While Training: $500 to $2,500
- CorePower Yoga provides all training at its corporate office located in Denver, Colorado or at other locations designated by it. You must pay for airfare, meals, transportation costs, salaries, benefits, lodging, and incidental expenses for all initial training program attendees.
3. Real Estate Leasing: $3,000 to $9,000
- If you do not own adequate space that is approved by CorePower Yoga, you must lease space for your Studio. Generally, this will require that you pay the first and the last months’ rent, plus a security deposit, at the time you sign the lease.
- Studios are generally located in retail and office complexes. The minimum size of a typical Studio is approximately 2,200 square feet for a facility containing 1 classroom and approximately 4,000 square feet for a facility containing 2 classrooms.
4. Architectural Fees: $5,000 to $10,000
- You must retain an architect to produce development plans for your Studio. CorePower Yoga reserves the right to require you to use one of its approved architects.
- You must send CorePower Yoga your development and construction plans and specifications for review and approval before you begin constructing your Studio.
5. Leasehold Improvements: $130,000 to $250,000
- These amounts reflect CorePower Yoga’s best estimate of the range of costs of leasehold improvements, based on its affiliate’s experience in specific markets and may vary substantially based on local conditions, including the availability and prices of labor and materials.
- They 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.
- These estimates assume that the landlord will provide a shell space which, at a minimum, includes concrete floors, demised exterior walls, HVAC, roof, and utilities sufficient for a Studio.
- These estimates include the costs associated with building out the interior finish of the Studio.
- This estimate does not include any tenant improvement allowance you may receive from the landlord of your Studio.
6. Furniture, Fixtures, and Equipment: $10,000 to $25,000
- This estimate includes the cost to purchase furniture and interior artwork and decor, the costs to install the mirrors and flooring, and the costs to acquire the necessary items to complete the build out of your Studio and to outfit your changing rooms and office.
7. Exterior Sign: $3,000 to $10,000
- You must purchase CorePower Yoga’s approved exterior sign for the front of your Studio. CorePower Yoga will provide you with the specifications that must be followed.
8. Computer Hardware and Software: $1,200 to $4,500
- You must purchase the Computer System, including paying any license fees required for use of the required software.
9. Inventory and Supplies: $1,000 to $2,000
- Your initial inventory and supplies will typically include yoga mats available for rental and purchase, towels available for rental, bottled water, instructional DVDs, and other promotional items from approved suppliers, which may be CorePower Yoga or its approved affiliates.
10. Retail Inventory: $0 to $10,000
- CorePower Yoga may require you to maintain a retail inventory of yoga apparel and related items at your Studio. If the franchisor required you to maintain a retail inventory, you must purchase the inventory it specifies from its approved suppliers, which may be CorePower Yoga or its affiliates.
11. Grand Opening Expenditure: $15,000 to $25,000
- The Franchise Agreement requires that you spend at least $15,000 as your Grand Opening Expenditure. However, CorePower Yoga estimates that you may spend up to $25,000 depending on the mediums you choose for your advertising.
12. Pre-Opening Costs and Expenses: $1,000 to $4,000
- These amounts represent CorePower Yoga’s best estimate of the range of costs involved in the “pre-opening” category. They reflect the expenses, before opening, of payroll and benefits, travel, hiring, and training materials for your hourly and salaried employees; supplies; various print media materials; and miscellaneous set-up costs for cable and telephone.
13. Additional Funds and Working Capital for First 3 Months: $20,000 to $50,000
- This is for budgeting purposes only to account for unanticipated expenses. This amount includes estimated operating expenses you should expect to incur during the first 3 months of operations.
- It includes Royalties; advertising; payroll costs; deposits; fees for city, state, and local business licenses; business entity organization expenses; other prepared expenses; accounting and professional fees; and other operational expenses.
- These figures do not include any taxes that you may pay.
14. Insurance: $1,500 to $3,000
- You must obtain and maintain certain types and amounts of insurance. Insurance providers may require either an annual payment or semi-annual installments. The estimates contemplate a semi-annual installment.
- These estimates also include an allocation of the premium you must pay in connection with the workers’ compensation insurance you are required to obtain for your employees. However, workers’ compensation insurance will vary from state to state.
15. Total Estimated Initial Investment: $216,200 to $430,000
- The estimated initial investment figures shown above for constructing and opening a Studio are based primarily on the costs incurred by CorePower Yoga’s affiliates.