AlphaGraphics Franchise Costs: Estimated Initial Investment (Item 7, 2022 FDD)
- Unless otherwise stated, these amounts are not refundable, except as you may arrange for real estate security deposits, utility deposits, or other third-party payments.
- These estimates do not include the cost to purchase the business of one of AlphaGraphics’ existing franchisees under a transfer, which may substantially increase your initial investment. Sales tax is not included in these fees but may be payable.
For a New Business Center
1. Initial Franchise Fee: $48,950
- If you sign a Franchise Award Letter and subsequently sign a Franchise Agreement with AlphaGraphics, then any amounts paid under the Franchise Award Letter will be applied toward your initial fees.
2. Opening/Reopening Performance Package: $10,000
3. Center Development Package: $142,750 to $167,450
- If you are a New Business Center franchisee, you must purchase from AlphaGraphics either its “base” Center Development Package for $142,750 or its “premium” Center Development Package for $167,450.
- The Center Development Package includes the initial cost of your computer system and certain other equipment, signage, and supplies listed in Schedule H to the Franchise Agreement.
- If you are an existing AlphaGraphics franchisee purchasing another AlphaGraphics franchise, AlphaGraphics may, at its sole option, allow you to obtain certain equipment, fixtures, or supplies listed in Schedule H of the Franchise Agreement from an alternative source, which items and sources must meet AlphaGraphics’ specifications, for use in your new Franchised Business Center.
- In such circumstances, you must pay the full Center Development Fee, but AlphaGraphics will issue credits to you for the specific equipment, fixtures, or supplies that will not be included in your Center Development Package and that AlphaGraphics authorizes you to obtain from an alternative source.
4. MIS System (PrintSmith Vision): $15,000
5. CRM System (Print Speak): $250
6. agOnline System: $1,500
7. Real Estate & Leasehold Improvements and Construction: $10,000 to $40,000
- The typical start-up Franchised Business Center site is approximately 1,800 to 2,500 square feet.
- The disclosed low-high range includes deposits and costs for Franchised Business Centers opened from 2018 through 2020 for the business centers in AlphaGraphics’ recommended size range, but not the purchase of land and building (because AlphaGraphics does not require you to purchase your premises).
- This range includes items related to leasehold improvements such as architectural and permitting fees, deposits, and other typical build-out costs. These costs can range significantly depending upon local markets and availability of suitable sites.
- Monthly rental rates could range between $1,800 to $5,000 based upon local market availability, size, condition, location of the property, and negotiations with the landlord.
8. Digital Printing Equipment: $0 to $3,600
- You must lease or purchase digital printing equipment that meets AlphaGraphics’ specifications. The digital printing equipment consists of one digital color printer with color print controller. AlphaGraphics recommends that you lease this equipment. This equipment is leased at a monthly cost of between approximately $950 and $1,200. In many cases, there are no lease payments due prior to opening your Center.
- The high end of the estimate is for three months of lease payments at the high end of the estimated monthly cost.
- You must purchase service contracts for all of the digital printing equipment. In addition, there is a per impression service charge.
- Should you choose to purchase the digital printing equipment instead of leasing, the cost ranges from approximately $38,128 to $49,748. Some Franchised Business Center franchisees elect to purchase additional digital printing equipment later.
- The costs indicated for the equipment package and the digital printing equipment may increase or decrease based on a variety of factors beyond AlphaGraphics’ control. These include, but are not limited to, pricing changes by the vendor, substitution of an alternative piece of equipment by the vendor, availability of the equipment from the vendor, and continued operation of the vendor.
- At times, AlphaGraphics may also see fit to change the Operations Manual and/or system Standards, which may change the required digital printing equipment. Such changes may impact the cost of digital printing equipment.
9. Finance Costs: $0 to $17,000
- You could incur these costs if you finance your initial investment.
10. Miscellaneous Opening Costs: $600 to $6,800
- This item covers miscellaneous opening costs and expenses, including utility deposits, licenses, attorneys’ and accountants’ fees.
11. Travel and Expense for Training: $2,450 to $4,900
12. Additional Funds – 12 Months: $50,000 to $74,000
- Additional funds are provided only as estimates and apply only to your initial 12 months of operations. Additional funds include working capital and other start-up expenses.
- This estimate also includes insurance, supplies, and payroll costs, but not any draw or salary for you or your living expenses.
- If you hire a full-time manager to satisfy the 40 hours per week outside sales requirement, you might need additional funds.
- AlphaGraphics has made certain assumptions based on revenue, operating costs, SBA guaranteed financing costs and payments, and costs for building rents in reaching this estimate.
13. Total: $281,500 to $389,450
- To compile these estimates, AlphaGraphics relied on its franchisees’ experience in operating the same type of business, its experience in franchising the same type of business, and its franchisees’ performance.