Detailed Estimates of Saladworks Franchise Costs Based on Item 7 (Estimated Initial Investment) of Saladworks’ 2017 Franchise Disclosure Document
For a Single Restaurant
1. Initial Franchise Fee: $30,000 to $35,000
- If you sign a franchise agreement for a single location, the initial franchise fee is $35,000. If you are an existing Saladworks franchisee in good standing, the initial franchise fee is $30,000. If you sign a multi-unit development agreement for 3 or more locations, the initial franchise fee is $30,000 for each location.
2. Architectural Plan Review: $0 to $1,000
- The franchisor’s preferred architect, to be engaged by you, will prepare the architectural plans for your restaurant based on the PDP, which is provided at no cost.
- You must provide the franchisor with complete architectural plans for its review and approval. The cost of using the franchisor’s preferred architect will be $11,500. If you do not use the franchisor’s preferred architect and choose to use a local architect, you must pay the franchisor an architectural plan review fee of $1,000, payable when you request the PDP.
3. Architect Fees: $11,500
- You will be responsible for the cost of your local architect, which the franchisor estimates will range from $11,500 to $12,500 or more, depending on the architect you choose and the geographic region of the country in which you are located.
4. Permits and License Fees: $0 to $5,000
- The cost for some required permits and license fees have been included in the Leasehold Improvements estimate for restaurants using the new buildout design. Depending on your general contractor or subcontractor, some permit costs and license fees also may be included in the construction estimate for the premises of your restaurant.
5. Leasehold Improvements: $243,685 to $307,203
- These estimates are based on the new Saladworks prototypical restaurant design of 1,700 to 2,000 square feet and assume the following factors: that your landlord will contribute between $40,000 and $60,000 toward the cost of the buildout of your restaurant, and that the premises contains a level concrete floor suitable for floor covering, demising walls, air conditioning, electricity, gas, sewers, bathroom facilities, water, and plumbing that meet code in your geographic area and that are suitable for your restaurant.
- The franchisor estimates that leasehold improvement costs for the new Saladworks prototypical restaurant design are about $138 per square foot for a strip center location.
- Your construction, remodeling, and decorating costs in a food court location may be lower due to the reduced size of a food court location.
6. Equipment and Furniture: $122,316
- The estimate set forth in the table assumes that you purchase your furniture, fixtures, and equipment. If you lease these items, you should expect to pay an initial payment of 20% of the price of the furniture, fixtures, and/or equipment (as a “down payment”) and the first and last months’ rent under the lease.
7. Millwork: $14,176 to $16,295
- Some millwork costs may be included in the Leasehold Improvements estimate for some restaurants, depending on your general contractor and subcontractor.
8. Smallwares: $6,917
9. Point of Sale System: $772 to $904
- This estimate covers the set-up fee and initial monthly Technology Bundle Fee for a single POS unit and a double POS unit.
10. Signage (interior and exterior) and Small Goods: $22,308 to $31,681
11. Travel and Living Expenses While Training: $0 to $2,500
12. Grand Opening Advertising: $5,000
- You must spend at least $5,000 to conduct a Grand Opening Advertising Program before and immediately on opening your restaurant, and you must provide proof of such expenditures before the franchisor approves your restaurant opening.
13. Miscellaneous Opening Costs: $10,427 to $15,886
- Miscellaneous opening costs include a sound system, security deposits, uniforms, menus, and office supplies.
14. Opening Inventory: $5,600
- You must at all times maintain sufficient inventory levels to satisfy your restaurant’s operations for a minimum of 3 days.
Turnkey Costs: $472,701 to $566,802
15. Real Property Lease/Purchase Costs: Amount Not Specified
- In the past, a Saladworks location in a strip center, pad site, freestanding, or downtown location typically ranged from 2,000 to 2,600 square feet. Under the new building design, the franchisor recommends a 1,600 to 2,000 square foot location for a strip center, pad site, freestanding, or downtown location. A Saladworks location in a mall food court typically ranges from 600 to 900 square feet.
- In addition, the cost to purchase, lease, or sublease a location may also include the additional cost for “extras,” such as the advertising fund, security, maintenance, sprinkler system, real estate taxes, other tenant expenses, percentage rent, or “key money,” which landlords sometimes charge for mall locations.
16. Insurance (1st 3 months): $3,000
- You must obtain insurance policies protecting yourself and the franchisor, and your and the franchisor’s respective officers, directors, partners, and personnel, against any demand or claim for personal injury, death, or property damage, or any loss, liability, or expense arising from the operation of your restaurant.
17. Additional Funds (1st 3 month): $22,388
- The estimate for additional funds includes funds you will need during the 1st 3 months of operations, and is based on the franchisor’s experience and includes, but is not limited to, wages for hourly employees (does not include a salary or draw for you), supplier payments, utilities, bank fees, and other miscellaneous costs and purchases. However, this is only an estimate.
Total (excluding real property costs): $25,388
Total Initial Investment (excluding real property costs): $489,089 to $592,190
- This is an estimate of your initial start-up expenses for the 1st 3 months, but does not include (i) real property costs, (ii) royalty fee or advertising fee payments, which are based on your Net Sales, or (iii) your draw or payment of expenses on your behalf.
- These figures are estimates only.