This post was updated on July 30, 2017 to reflect information from BurgerFi’s 2017 FDD (Item 7).
Detailed Estimates of BurgerFi Franchise Costs Based on Item 7 (Estimated Initial Investment) of BurgerFi’s 2017 Franchise Disclosure Document
1. Franchise Fee: $37,500
- BurgerFi does not charge any fees or expenses in providing site selection and construction management oversight.
2. Rent – 3 Months: $17,500 to $44,000
- The typical size for a BurgerFi restaurant is 2,500 to 3,200 square feet. The estimates assume that base rental costs are from $28 to $55 per square foot, annually.
- In addition to base rent, the lease may require you to pay common area maintenance charges, your pro rata share of the real estate taxes and insurance, and your pro rata share of other charges.
3. Security Deposits: $10,000 to $25,000
- BurgerFi expects that you will need to pay deposits for your local utilities, such as telephone, electricity, and gas, and your landlord may require you to pay a security deposit.
4. Leasehold Improvements: $305,000 to $368,000
- These amounts are based on the cost of adapting BurgerFi’s prototypical architectural and design plans to remodel and finish-out the Restaurant and the cost of leasehold improvements.
- The low estimate assumes a “second generation” restaurant space (meaning the space was formerly a restaurant) of 2,500 square feet and the high estimate assumes a “first generation” restaurant space (meaning that a restaurant has never been operated at the space) of 3,200 square feet, with leasehold improvements ranging from $115 to $122 per square foot.
5. Equipment, Furniture, and Fixtures: $283,000 to $315,000
- The equipment you will need for your Restaurant includes a point of sale (POS) computer system and digital menu boards, reach-in refrigerators and freezer, walk-in cooler, grills, fryers, prep tables, ice cream and custard equipment, and smallwares.
- The furniture and fixtures you will need for your Restaurant include decor items, booths, tables, chairs, and stools.
- BurgerFi estimates that the total cost to purchase and install these items will range from $283,000 to $315,000.
- It may be possible to lease some of these items, which will lower the amounts shown.
6. Insurance – 3 Months: $1,500 to $3,000
7. Permits and Licenses: $1,500 to $8,000
- The estimate includes the cost of obtaining local business licenses which typically remain in effect for one year.
- The estimate of the costs for permits and licenses does not include a wine and beer license. The cost of a wine and beer license can range from under $2,000 to over $100,000, depending on the location and jurisdiction, but can be even higher in some states.
8. Initial Inventory: $20,000 to $24,000
- The estimate includes your initial inventory of food products, ingredients, beverages, beer, wine, and paper goods.
9. Signage: $4,000 to $15,000
- These amounts represent your cost for your interior and exterior signage.
10. Grand Opening Advertising: $15,000 to $30,000
- You must conduct a grand opening advertising campaign to promote the opening of your Restaurant.
- At BurgerFi’s request, you must provide the grand opening advertising money to it and it will conduct the grand opening advertising campaign on your behalf.
11. Architect & MEP Drawings: $12,500 to $20,000
- You must hire an approved architect to adapt BurgerFi’s standard plans and specifications to create construction drawings, including a kitchen layout design, that are specific to your approved location.
12. Travel Expenses for Training: $0 to $12,500
- These estimates include only your out-of-pocket costs associated with attending the initial training program, including travel, lodging, meals, and applicable wages for the first three trainees. These amounts do not include any fees or expenses for training any other personnel.
13. Professional Fees: $2,500 to $6,500
- BurgerFi expects that you will retain an attorney and an accountant to assist you with evaluating the franchise offering, and with negotiating your lease or purchase agreement for the approved location.
14. Opening Assistance: $0 to $15,000
- In connection with opening, BurgerFi shall provide you with up to 5 of its representatives for up to 14 days. You must pay the current per diem rate for trainers, plus reimburse their expenses, such as travel, lodging, and incidentals.
- There are several factors that will impact your training costs, including the amount of advanced notice given to BurgerFi so it can book travel arrangements, seasonality increases, and local events that directly affect availability and rates.
- Travel rates are generally lower with at least a 14-day notice to book, thereafter rates can increase significantly, especially within 7 days’ notice when rates are usually at full tariff.
- A deposit of $5,000 is required prior to the training team being scheduled. BurgerFi will not book a training team until it has received the deposit. The final payment is due upon receipt of the final
15. Additional Funds (3 months): $10,000 to $45,000
- This estimates your initial start-up expenses for an initial three-month period, not including payroll costs, and does not include any revenue that your Restaurant may earn in the first three months of operation.
16. Total: $720,000 to $968,500