Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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Franchise Costs: Detailed Estimates of FASTSIGNS Franchise Costs (2016 FDD)

by Franchise Chatter on October 18, 2015

in Franchise Costs, Sign Franchises

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Don't Invest in a Franchise Until You Check Out This List

FASTSIGNS Center Photo by Carolinadoug

This post was updated on February 20, 2017 to reflect information from FASTSIGNS’ 2016 FDD (Item 7).

Detailed Estimates of FASTSIGNS Franchise Costs Based on Item 7 (Estimated Initial Investment) of FASTSIGNS’ 2016 Franchise Disclosure Document

For a Full-Service Center

1.  Initial Franchise Fee:  $22,250 to $44,500

  • You must pay an initial franchise fee of $44,500 if you sign a Franchise Agreement to obtain a single FASTSIGNS Center or for the first FASTSIGNS Center under a Development Agreement.
  • The initial franchise fee for additional FASTSIGNS Centers under a Development Agreement is $22,250.

2.  Leasehold Improvements:  $13,863 to $59,823

  • These amounts are based on the cost of adapting the prototypical architectural and design plans to remodel and finish-out the Center and the cost of leasehold improvements. The amounts shown are based on actual costs for new FASTSIGNS Centers opened over the past 12 months that were built out with the recommended new Center footprint of 1,300 to 1,500 square feet, plus or minus 15%.
  • Finish-out costs are based on leasing unfinished space that consists of walls, plumbing, concrete slab, lighting, HVAC, and electric.

3.  Furniture and Fixtures:  $9,009

  • The figures shown include an estimate for office furniture, counter, work tables, file cabinets, and other fixtures included in the fixtures package.

4.  Deposits:  $1,300 to $4,641

  • Deposits for site lease and utilities. The figure includes miscellaneous utility deposits such as telephone, electric, gas, and water.
  • You will lease the Center premises, typically located in a strip-shopping center, office/business park or free-standing building, which is located in a visible location on a primary corridor.
  • The premises for a FASTSIGNS Center is typically 1,300 to 1,500 square feet at approximately $12 to $35 per square foot in annual rent.

5.  Telephone and Networking:  $500 to $8,398

  • The figures shown include installation of a telephone system, installing necessary network cables, networking of all computers, printers, and phone system.

6.  Decor and Graphics:  $1,684

  • Included are the menu boards and all of the signage required for these boards.

7.  Tools, Supplies, and Substrate Cutter:  $5,224

  • You will purchase various tools, cutting devices, and materials. You will purchase a substrate cutter that meets the franchisor’s specifications from the recommended supplier or your supplier of choice.
  • The franchisor may request that you pay it a deposit of up to $20,000 prior to opening your Center to purchase these items on your behalf.

8.  Production Equipment:  $34,327 to $40,327

  • The figure includes estimated costs for sign making computer systems, software, and peripherals used in the FASTSIGNS System to design and output signs and graphics.

9.  Point-of-Sale Computer:  $5,578 to $7,338

  • You will use the point-of-sale system, a cloud-based software, the franchisor requires. You will purchase the hardware, printer, and other system components from DELL.

10.  Signage:  $1,500 to $7,700

  • Exterior signage is coordinated by the franchisor and is purchased from the preferred vendor. The signage can be purchased locally with authorization from the franchisor before manufacture of exterior signage.
  • For 2015, the average for exterior signage was $4,309.

11.  Initial Inventory:  $2,755

  • The inventory consists of sign and graphic materials such as: plastics, vinyl, magnetic materials, aluminum, media, laminates, exhibits and displays, and other materials.

12.  Architectural/Engineering:  $0 to $6,378

  • FASTSIGNS provides you, free of charge, with an electronic copy of a space plan layout and design development construction drawings for one site, including all specifications for the build-out of the Center.
  • This service includes 1 revision, for any reason, including changes in layout and revisions due to local building permit requirements.
  • As provided, these plans do not include electrical, plumbing, mechanical engineering services, Title 24 or other requirements by state and municipality, and the plans are not sealed by an architect.

13.  Initial Advertising:  $12,500

  • The Franchise Agreement requires you to spend not less than $12,500 ($8,500 for Conversion Franchise, Co-Brand Center and for the sale of an existing FASTSIGNS Center to a third party) on initial marketing and advertising for the Center in your local market.

14.  Travel, Lodging, Meals, and 2 Employees’ Costs for Initial Training:  $4,326 to $9,070

  • Initial training consists of 3 weeks for you and 2 weeks for your employees. The amounts shown are estimated costs for your training (3 weeks) and 1 to 2 employees’ training (2 weeks).
  • The franchisor incorporated the basic expenses for you or your Managing Principal to spend 5 days in a center prior to attending initial training.

15.  Administrative Supplies:  $1,356

  • The franchisor requires you to purchase the following, typically from a designated provider:  credit card processing system, high-speed internet, and 3-month supply of office supplies (stationery, business cards, forms, and administrative sundries).

16.  Business Licenses and Permits:  $50 to $2,736

  • These are estimates for local business licenses (typically one year in duration). These figures do not include occupancy and construction permits.

17.  Insurance Deposits and Premiums (first 3 months):  $300 to $2,567

  • You will obtain before beginning construction and maintain throughout the term of the Franchise Agreement, comprehensive general liability, motor vehicle liability, and employers’ and workers’ compensation insurance.

18.  Professional Fees:  $0 to $2,900

  • FASTSIGNS strongly recommends you hire a lawyer and an accountant to help you evaluate this opportunity, the lease for the Center, and to advise you in establishing your business generally.
  • This section includes the fees to install, train, and maintain equipment (printer, laminator, cutters) and waste disposal.

19.  Digital Sign Kiosk, Digital Signage Demo Kit, Touchscreen Unit, Laser Measurement Solution, and a Chromebox with License:  $4,619

  • FASTSIGNS has included the cost of a digital sign kiosk, a digital signage demo kit, AOPEN 19″ Elite touchscreen unit, ASUS M106U Chromebox with CMC license, and a Spike Unit laser measurement solution for sales presentations.

20.  Working Capital:  $30,000 to $60,000

  • These amounts are estimates of initial working capital costs such as rent, telephone, utilities, employee wages, benefits, workers’ compensation, advertising and promotional activities, inventory costs, Service Fee and Ad Fee payments, operational supplies, and professional fees.
  • These figures are estimates and the franchisor cannot assure you that you will not have additional expenses operating the Center.

21.  Total:  $151,141 to $293,525

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