Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

  • Anytime Fitness
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  • Massage Envy
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Franchise Costs: Detailed Estimates of Culver’s Franchise Costs (2017 FDD)

by Franchise Chatter on January 26, 2016

in Franchise Costs, Frozen Dessert Franchise, Hamburger Franchise



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Culver's Concrete

This post was updated on May 9, 2017 to reflect information from Culver’s 2017 FDD (Item 7).

Detailed Estimates of Culver’s Franchise Costs Based on Item 7 (Estimated Initial Investment) of Culver’s 2017 Franchise Disclosure Document

1.  Initial Franchise Fee:  $20,000 to $55,000

  • The initial franchise fee generally is $55,000. The initial franchise fee for certain existing franchisees who open an additional Restaurant is $45,000. The initial franchise fee for certain existing franchisees that offer at least a 19% interest in their franchise entity to an existing Key Manager is $30,000.
  • The initial fee may be reduced by $10,000 if you qualify for Culver’s Veteran’s discount.

2.  Land:  $200,000 to $1,400,000

  • The minimum amount stated will be less if you lease the land upon which your Restaurant sits.
  • The cost of purchasing unimproved land will vary significantly depending on location, availability of utilities, and other factors. Depending on the market conditions and other factors in your geographic area, your land costs may vary from the estimates.
  • Culver’s estimates that the size of your land will range from 40,000 to 50,000 square feet.

3.  Site Work:  $182,000 to $373,000



  • Culver’s assumes that you will acquire land for the Restaurant, and this estimate is for the cost of developing the site when constructing a new building. The minimum amount stated will be less if you lease the building for your Restaurant.
  • The site costs for a building will vary significantly depending on many factors including the difficulty of site work, labor costs, local taxes and development fees, and the availability of financing.
  • You may also buy an existing building to convert into a Culver’s Restaurant at a lower cost than new construction. As a result, you may experience site work costs that vary from the estimated amount provided here.

4.  Building:  $755,000 to $1,420,000

  • Culver’s assumes that you will acquire land and build the building for the Restaurant, and this estimate is for the cost of constructing a new building. The minimum amount stated will be less if you lease the building for your Restaurant.
  • The Restaurant premises are typically freestanding. This estimate includes the expense of a new, completely finished building, including carpentry, all interior finishes, mechanical, electrical, and plumbing.
  • This estimate also includes fees for architectural and engineering services such as site planning, state approvals, and other permits for building, heating and airconditioning, plumbing, bid review, construction coordination, pay request review, and project closeout.
  • You may also buy an existing building to convert into a Culver’s Restaurant at a lower cost than new construction.

5.  Travel, Living, and Other Expenses During Training:  $20,000 to $80,000

  • You are responsible for making arrangements and paying the expenses for any persons attending the training program and for on-site training at your Restaurant before opening, including transportation and lodging.
  • The low estimate reflects training cost for an existing franchisee who is purchasing his/her second Restaurant and contemplates the training of 3 managers for 7 weeks each, 3 key employees for 20 hours each, and 45 crew members for 12 hours each.
  • The high estimate contemplates the training of 2 shareholders of the franchise for 16 weeks each, 6 managers for 7 weeks each, 4 key employees for 40 hours each, and 60 crew members for 17 hours each.

6.  Initial Inventory:  $35,000 to $45,000

  • Initial inventory consists of various food products, beverages, paper products, cleaning supplies, and other supplies utilized in operating the Restaurant, as well as other merchandise or products sold in the Restaurant.
  • The initial inventory expenditure will vary according to anticipated sales volume.

7.  Furniture, Fixtures, Equipment, and Supplies (excluding sign package and POS cash register system):  $386,000 to $490,000

  • The estimate includes the cost to acquire all furniture, fixtures, equipment, and supplies necessary to operate your Restaurant, including interior but not exterior signs, Restaurant appliances (dishwasher, grill, fryers, freezer, walk-in cooler/freezer, ice machine, and other similar foodservice equipment), smallwares, fountain beverage equipment, office equipment (including computer hardware and software), custard machine(s), including the costs for installation, and uniforms, as well as freight charges, but it does not include sales tax.

8.  Sign Package:  $106,000 to $220,000

  • The estimate includes the cost to acquire and install all exterior signs for your Restaurant, but it does not include sales tax.
  • Your investment in exterior signs necessary to operate the Restaurant is highly variable. Your exact investment depends on several factors, including the number and size of the proposed exterior signs, local labor costs, prices charged by suppliers, inflation, financing costs, and similar factors beyond the franchisor’s or your control.
  • All exterior signs and supplies for your Restaurant must meet Culver’s standards and specifications and comply with any local government regulations.

9.  POS Cash Register System:  $41,000 to $50,000

  • The estimate includes the cost to acquire and install all point of sale system/cash registers, but it does not include sales tax. All point of sale system/cash registers for your Restaurant must meet Culver’s standards and specifications.

10.  Miscellaneous Expenses:  $20,000 to $40,000

  • This amount estimates attorneys’ fees, accounting fees, business licenses, restaurant association and local chamber of commerce member fees, utility deposits, and costs associated with your Restaurant’s “Open House.”

11.  Additional Funds (Working Capital) for 3 Months:  $50,000 to $100,000

  • This amount of working capital is projected as sufficient to cover initial operating expenses for a period of 3 months. These figures are estimates, and Culver’s cannot guarantee you will not have additional expenses starting the business.
  • Expenses not included are hourly labor and benefits costs, food and product costs, and rent.

12.  Totals:  $1,815,000 to $4,273,000

  • Culver’s requires that you have 20% of your total projected initial investment in cash or liquid assets.
  • The franchisor has used CFSI’s (including its predecessor and affiliates) more than 30 years of experience in the business to compile these estimates.


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