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Franchise Costs: Detailed Estimates of Brothers Bar & Grill Franchise Costs (2016 FDD)

by Franchise Chatter on November 24, 2015

in Bar Franchise, Franchise Costs, Sports Bar Franchise

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Brothers Bar and Grill Photo by Rodwin Architecture 3

This post was updated on March 1, 2017 to reflect information from Brothers Bar & Grill’s 2016 FDD (Item 7).

Detailed Estimates of Brothers Bar & Grill Franchise Costs Based on Item 7 (Estimated Initial Investment) of Brothers Bar & Grill’s 2016 Franchise Disclosure Document

1.  Initial Franchise Fee:  $50,000

  • The amount included in the chart is for your first Brothers Bar & Grill. If you are currently operating a bar and grill and you are converting it into a Brothers Bar & Grill, the Initial Franchise Fee shall be $30,000. If you already own a Brothers Bar & Grill, the Initial Franchise Fee shall be $40,000.
  • The franchisor is currently offering a 10% discount off the Initial Franchise Fee to honorably discharged veterans of the U.S. armed forces.

2.  Training:  $15,000 to $20,000

  • Your General Manager and at least 2 other managers (including your kitchen manager) or assistant managers must, at your sole cost, attend training and complete training to the franchisor’s satisfaction.
  • You must make arrangements and pay the expenses to attend the training program, including transportation, lodging, meals, and wages.
  • The estimate provided contemplates initial training of 3 people for roughly 3 or 5 weeks.
  • Your kitchen manager will have 2 days of classroom training and 3 weeks of onsite store training. Your General Manager and other front of house managers or assistant managers will have 2 days of classroom training and 5 weeks of onsite store training.

3.  Rent:  Amount Not Specified

  • The franchisor estimates that you will need between 5,000 and 7,500 square feet for your Brothers Bar & Grill in or near an existing entertainment district.
  • The rental and purchase price of real estate varies greatly depending on a variety of factors. Therefore, the estimates above do not include the costs of renting or purchasing space.
  • Your initial investment could be considerably larger than the total initial investment stated depending on the price of real estate rental in your area. If you choose to buy the real estate instead of leasing, your initial investment will be even larger.

4.  Initial Remodeling and Improvements:  $1,000,000 to $1,300,000 (land not included)

  • The estimate includes your architectural and engineering fees.
  • If you choose to build and own the Brothers Bar & Grill premises, the cost for your long-term real property investment obligations will be significantly higher.

5.  Furniture, Fixtures, and Equipment:  $400,000 to $450,000

  • The franchisor will provide you with a list of the furniture, fixtures, and equipment necessary for the operation of a Brothers Bar & Grill, which include refrigerators, freezers, ovens, tables, chairs, and other equipment, furniture, and fixtures.

6.  Lease & Utility Security Deposits:  $5,000 to $15,000

  • Landlords may require a security deposit, and utility companies may require that you place a deposit prior to installing telephone, gas, electricity, and other utility services.
  • A typical utility security deposit is one month’s expense. A typical lease security deposit will be an amount equal to one month’s rent.
  • These estimates may be significantly higher in some jurisdictions where the local authorities may require fees in excess of $100,000 for electrical or sewer/water connections.

7.  Signage:  $25,000 to $50,000

8.  Computer/POS System:  $35,000 to $50,000

  • The estimate includes only the minimum equipment that the franchisor will require you to have. The cost of the computer system will vary greatly depending on vendor, capabilities, and additional equipment or software you may desire.

9.  Audio Visual Equipment:  $90,000 to $110,000

  • The estimates for audio/visual equipment are only for the minimum equipment the franchisor requires. Your initial investment for this concept may be substantially greater if you decide to carry more than the minimum audio/visual equipment required by the franchisor.

10.  Initial Inventory:  $70,000 to $90,000

  • Your initial inventory must be purchased from approved suppliers or in accordance with the franchisor’s specifications. Initial inventory includes various food products, beverages, paper products, cleaning supplies, and other supplies used in the operation of the Brothers Bar & Grill as well as other merchandise or products sold by the Brothers Bar & Grill.

11.  Insurance:  $5,000 to $10,000

  • The estimate is for approximately 25% of an annual premium of the insurance you must carry, and includes liquor liability coverage. The balance of the annual premium is generally payable over a 9-month period.

12.  Grand Opening Advertising/Marketing:  $10,000 to $15,000

  • These amounts generally will be spent prior to and through the first 45 days of operation of your Brothers Bar & Grill.

13.  Office Equipment and Supplies:  $5,000 to $10,000

14.  Liquor License:  $2,000 to $40,000

  • Brothers Bar & Grill establishments generate most of their revenue from the sale of alcoholic beverages. It is your responsibility to obtain and maintain a liquor license for your Brothers Bar & Grill that imposes no restrictions regarding the percentage of revenues generated by the sale of alcoholic beverages as opposed to the sale of food or other products.
  • You should retain legal counsel specializing in obtaining and maintaining liquor licenses.
  • The cost of a liquor license can be considerably higher in a few states where the number of licenses is severely restricted or available only from an existing holder.

15.  Business Licenses/Legal and Professional:  $20,000 to $25,000

16.  Additional Funds (prior to opening through first 3 months):  $75,000 to $125,000

  • This estimate is based on the operating expenses for the first three months of operations, local promotion, marketing and advertising, additional training, and new business development.
  • The franchisor has considered and relied on the experience of the Brothers Bar & Grill establishments operated by its affiliates to arrive at these estimates.

17.  Total:  $1,807,000 to $2,360,000 (land not included)

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