This post was updated on March 12, 2017 to reflect information from Bananas Smoothies and Frozen Yogurt’s 2016 FDD (Item 7).
Detailed Estimates of Bananas Smoothies and Frozen Yogurt Franchise Costs Based on Item 7 (Estimated Initial Investment) of Bananas Smoothies and Frozen Yogurt’s 2016 Franchise Disclosure Document
1. Franchise Fee: $22,000
2. Equipment and Furnishings: $70,000 to $125,000
- You will need to purchase certain types of equipment for the operation of your Bananas Smoothies and Frozen Yogurt restaurant depending on what types of products you intend to sell from your restaurant.
- This equipment includes, for example, soft serve machines (in the event you offer Everything Yogurt brand yogurt), commercial refrigeration and freezer units, smallwares, blenders and juice dispensers (if you offer Bananas Smoothies & Frozen Yogurt brand frosties and smoothies), dough mixing machines (if you offer Gretel’s Pretzels brand pretzels), heated/humidified pretzel display case, convection ovens, ice cream case, coffee, espresso, and cappuccino machines, showcases, computer hardware and software, cash registers or Point of Sale system, and other kitchen equipment for quick service restaurants.
- The low-end equipment costs anticipate that the location was a food service business and contains certain equipment that could be used by your Franchised Business.
3. Signs: $5,000 to $12,000
- You will need to purchase the required signs including signs for the exterior of the restaurant and interior menu signs.
4. Real Estate: Amount Not Specified
- You must purchase or lease the site approved by the franchisor for the Franchised Business. The cost of purchase or rental for such real estate will vary considerably.
- You may be required to provide the landlord with a security deposit.
- Bananas Smoothies & Frozen Yogurt franchised restaurants or combinations of restaurants are situated in shopping malls or other high volume commercial districts. The following describes the size requirements:
- Site Size Minimum: 300 sq. feet
- Site Size Maximum: 700 sq. feet
- Frontage Minimum: 15-18 sq. feet
- Site Size Minimum: 425 sq. feet
- Site Size Maximum: 1,000 sq. feet
- Frontage Minimum: 12-20 sq. feet
- Actual minimums and maximums will vary depending upon food court seating versus restaurant seating as available/needed.
5. Building Construction: $70,000 to $150,000
- You must pay for or provide financing for the construction of each Franchised Business, including, but not limited to, the installation of fixtures, equipment, interior decor, as well as design and construction.
- Construction costs at the lower end are based on the assumption that the location was previously a food service operation. Therefore, it is anticipated that construction in a location formerly used for food service may be completed at considerable savings over construction at a non-food service site.
6. Insurance: $2,000 to $5,000
- You must have certain specified insurance. The timing of your payments is a matter to be resolved between you and your insurer.
7. Opening Inventory: $1,500 to $7,000
- Opening inventory will include all approved products and may also include a trial inventory for training. You will gauge the amount of inventory by projected sales.
8. Utility Deposits: $2,000
- Utility deposits are for gas, electric, water, sewer, and telephone service.
9. Business Licenses (local health and safety regulation and compliance costs): $1,000 to $4,000
- Local, municipal, county, and state regulations vary on what licenses and permits are required by you to operate a Franchised Business. Such fees are paid to governmental authorities when incurred before commencing business.
10. Travel, Lodging, and Meals for Initial Training: $3,000 to $5,000
- The estimate includes transportation, lodging, and meals for trainees. Generally, these costs will vary widely with the distance traveled, the accommodation selected, and the mode of transportation selected.
11. Professional Fees: $5,000 to $10,000
- You may need to employ an attorney, accountant, construction permit expediter, architect, or other consultants.
12. Additional Funds (three months): $25,000 to $50,000
- You will need to support ongoing expenses, such as payroll and utilities, to the extent that these costs are not covered by sales revenue.
13. Computer Equipment: $10,000 to $20,000
- You must purchase or lease a computer or electronic cash register, and the franchisor does specify the brand or model. You may not use any hardware and/or software in the operation of the restaurant without the franchisor’s prior approval, which approval will not be unreasonably withheld.
14. Advertising and Marketing: $3,000 to $5,000
15. Total: $219,500 to $417,000
- The franchisor relied on its past experience in the franchised restaurant industry with franchisee and company-owned stores when preparing these figures.