Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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Franchise Costs: Detailed Estimates of BrightStar Care Franchise Costs (2016 FDD)

by Franchise Chatter on November 1, 2015

in Franchise Costs, Senior Home Care Franchises

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BrightStar Care Photo by BrightStarTX1This post was updated on February 7, 2017 to reflect information from BrightStar Care’s 2016 FDD (Item 7).

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

1.  Initial Franchise Fee:  $50,000 for the first 200,000 to 250,000 population in your Protected Territory plus $200 for each additional 1,000 (or portion thereof) individuals in your Protected Territory above 250,000

2.  Leased Space for Agency:  $3,200 to $7,200

  • You will need approximately 250 to 800 square feet of office space. This estimate includes rent for the first three months and a deposit of the last month’s rent.
  • If a landlord is paying for some of the improvements to the leased space, they may be amortizing that expense in the form of additional rent.

3.  Furnishings:  $1,500 to $3,000

  • This includes 3 desks, 3 office chairs, 2 guest chairs, telephone equipment, pictures, curtains, and office supplies.

4.  Computer Infrastructure:  $3,500 to $5,500

  • You will initially need 4 desktop computers or laptops running the current Microsoft Windows operating system, and associated peripherals, including monitors, Office suite and other software, local network router, other network accessories, a printer, a scanner, and any installation services to install in your office.

5.  Signage:  $300 to $1,000

  • All signage is subject to BrightStar Care’s approval.

6.  Utility Deposits:  $100 to $500

  • This item includes utility deposits, telephone company deposits, electric, and other energy company deposits.

7.  Marketing Materials (brochures, business cards, etc.):  $900 plus shipping and handling

  • Includes a 3-month supply of brochures and business cards.

8.  Grand Opening Advertising:  $0 to $3,000

9.  Business Licenses and Home Health Agency License:  $200 to $7,400

  • State rules vary on medical and staffing licensure and other associated licenses, e.g. CLIA waiver.

10.  Joint Commission Accreditation Application Fee and Membership and Initial Accreditation Visit:  $0 to $4,250

  • You must obtain and maintain in good standing Joint Commission Accreditation at all times during the term of your Franchise Agreement.

11.  Consultants and/or Director of Nursing hired in advance of opening to meet licensure requirements, as needed:  $0 to $5,040

  • Some states require you to hire a Consultant and/or Director of Nursing in advance of opening to meet state licensure requirements.

12.  CPA to Certify Licensure Submission:  $0 to $1,000

  • This estimate will vary depending on your financial acumen.

13.  Insurance (excluding workers’ comp):  $4,455 to $6,876

  • The estimate above represents your estimated insurance costs (excluding workers’ comp) for the first three months you operate your Agency.

14.  Workers’ Comp Insurance:  $645 to $14,890

  • The estimate above represents your estimated workers’ comp for the first three months you operate your Agency.

15.  CSA (Certified Senior Advisor) Training and Certification:  $0 to $1,595

  • The estimate above reflects the fees for CSA training and certification.

16.  Various Dues and Memberships:  $0 to $500 annually. Paid within first three months in full.

17.  Loan Packaging Fee (SBA Loan or Non-SBA Loan):  $0 to $2,500

  • Bancorp Bank SBA Loan Packaging Fee is $2,500 and Bank of America, NA Non-SBA Loan packaging fee is $1,500.

18.  Employee Travel and Living Expenses:  $3,360 to $4,260

  • These expenses should average $120 per day per person in attendance.

19.  Legal Fees:  $1,000 to $5,000

  • The estimate above reflects the fees for review of BrightStar employment templates and customer contract templates for any necessary modifications required by local and state law.

20.  Additional Operating Funds – 3 Months:  $26,276 to $64,027

  • The estimate for additional operating funds above reflects the period through the end of 3 months after opening your Agency. With increased difficulty in accessing credit, BrightStar Care recommends having additional working capital on-hand.
  • Specifically, BrightStar Care estimates that you will need approximately $128,586 to $312,944 in total additional operating funds for the first 12 months you operate the Agency, without factoring the amount of gross margin that would reduce this amount.

21.  Total:  $92,371 to $174,032

  • The franchisor relied upon its franchisees’ experiences in opening and operating their BrightStar Care Agencies in preparing these estimates.

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