Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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Franchise Costs: Detailed Estimates of UFood Grill Franchise Costs (2016 FDD)

by Franchise Chatter on July 31, 2016

in Fast Casual Restaurant Franchise, Franchise Costs

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UFood Grill Interior Photo

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

1.  Initial Franchise Fee:  $35,000

2.  Project Management Fee:  $0 to $7,500

  • The franchisor reserves the right to designate and retain a third-party project management company, to prepare project management plans for the UFood Grill Outlet, and to oversee planning, development, and construction of the location on your behalf to meet UFood Grill’s standards.
  • Upon the signing of the Franchise Agreement, you must pay to the franchisor a Project Management Fee of $7,500 to cover the costs of those services. The Project Management Fee is uniform for all franchisees.
  • The Project Management Fee does not cover the cost of any design and construction services.

3.  Real Estate/Rent – 3 Months:  $10,000 to $30,000

  • The franchisor estimates that the typical UFood Grill Outlet location will have approximately 1,000 to 2,500 square feet. A UFood Grill Outlet may be located in a strip shopping center, shopping mall, free standing unit, or other venue in a downtown commercial area or a residential area.
  • The franchisor expects that nearly all UFood Grill Outlet locations will be leased rather than purchased. However, if you purchase the site for the Outlet, the initial investment will be significantly higher.

4.  Security Deposit:  $5,000 to $10,000

5.  Leasehold Improvements:  $180,000 to $250,000

  • Leasehold improvement costs include floor covering, wall treatment, counters, ceilings, painting, window coverings, electrical, carpentry, and similar work, and architect’s and contractor’s fees.
  • The interior and exterior of the UFood Grill Outlet must be built to conform to the franchisor’s store design specifications.

6.  Furniture, Fixtures, and Equipment:  $105,000 to $135,000

  • This includes refrigerators and freezers, stoves and ovens, catering supplies, and other kitchen equipment; front of house and back of house furniture; and lighting.
  • The low end of this range assumes you purchase some used equipment, the higher end is for new equipment.
  • These estimates are of the cost of buying these items. Your initial investment may be lower if you lease these items.

7.  Signage (interior and exterior):  $5,000 to $15,000

8.  Professional Fees:  $15,000 to $20,000

9.  POS Computer System, and Other Office Equipment and Supplies:  $19,000 to $25,000

  • This range covers the cost of the Computer System, other office equipment (e.g. copy machine and fax machine), and office supplies.
  • These estimates are of the cost of buying these items. Your initial investment may be lower if you lease these items.

10.  Smallwares:  $7,500 to $8,000

11.  Opening Inventory and Supplies:  $7,500 to $10,000

12.  Grand Opening Marketing Fee:  $10,000

  • The Grand Opening Marketing Fee applies only to the Franchise Agreement. This amount covers the development and implementation of a Grand Opening Marketing program on your behalf. The franchisor will provide details on how the funds were expended.

13.  Training Expenses (out-of-pocket costs for training in Boston and pre-opening training at location):  $5,000 to $10,000

14.  Working Capital – 3 Months:  $20,000 to $40,000

  • This item estimates your initial startup expenses (other than the items identified separately in the table) based on the franchisor’s and its affiliate’s experience since 2004 in franchising and operating UFood Grill Outlets.
  • These expenses include payroll costs but not any draw or salary for you.

15.  Total Estimated Initial Investment:  $424,000 to $605,500

  • The franchisor relied on its experience since 2013, that of its predecessors since February 2004, and the combined experience of its officers and directors to compile these estimates.

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