Updated September 30, 2018.
Detailed Estimates of Sweetwaters Coffee & Tea Franchise Costs Based on Item 7 (Estimated Initial Investment) of Sweetwaters Coffee & Tea’s 2018 Franchise Disclosure Document
1. Initial Franchise Fee: $49,500
- The Initial Franchise Fee is based on entering into one Franchise Agreement for a single unit.
2. Initial Training Fee: $5,000
- You must pay Sweetwaters the Initial Training Fee amounting to $5,000, which will cover the tuition associated with you and any other individuals that attend and otherwise participate in Sweetwaters’ proprietary Initial Training Program, so long as all of these individuals attend at the same time.
- The Initial Training Fee does not cover costs and expenses incurred in connection with attending or otherwise participating in any part of Sweetwaters’ Initial Training Program, which may include travel, lodging, meals, or salaries.
3. Initial Training Expenses: $2,365 to $3,065
- This is Sweetwaters’ estimated range of costs to cover the travel and living expenses, including airfare, lodging, and meals, which you will incur when you and your employees attend the Initial Training Program.
- This estimate does not include any wages or salary for you or your trainees during training.
4. Pre-Construction: $12,000 to $31,500
- Pre-construction costs include the amounts typically paid to Sweetwaters’ approved supplier for certain construction consulting, pre-construction management services, and architectural drawings, as well as the amounts paid to any other third-party suppliers in connection with pre-construction services and products.
5. Permits: $2,000 to $28,615
- You are required to obtain all business licenses, permits, certificates, or approvals before you start business.
- This estimate does not include any fees that you may incur with permit consultation services.
6. Leasehold Improvements: $76,427 to $267,674
- As previously noted, Sweetwaters estimates that a typical Cafe will be between 1,100 sq. ft. and 1,800 sq. ft. in size.
- Based on Sweetwaters’ experience and the experience of its franchised locations, the range above for leasehold improvements assumes that you will incur costs on a “per square foot” basis to construct and/or build-out your Cafe in accordance with Sweetwaters’ specifications (taking into account the range of Tenant Finish Allowance or Landlord Contribution described below).
7. Exterior Signage: $8,000 to $12,300
- The cost of signage and graphics will vary from location to location depending on lease requirements, local ordinances and restrictions, location frontage, and related factors.
- The figures provided in the chart reflect a location with one exterior sign or a location with one exterior and one interior sign respectively.
8. Utility Deposits: $0 to $300
9. Fixtures and Equipment, Including Interior Signage: $66,490 to $125,000
- You will need to purchase furniture and fixtures that meet Sweetwaters’ specifications as well as the supplies that it designates.
- You may decide to lease the furniture and/or equipment needed rather than purchasing it with a lump sum payment.
- The amounts listed are an estimate and may vary per your location and market.
10. POS System, Including License Fee and Gift Card System: $2,547 to $2,660
11. Organizational Costs: $800 to $1,500
12. Opening Inventory, Supplies, and Cafe Set-Up Expenses: $15,000 to $17,000
13. Construction Management: $0 to $20,000
- Sweetwaters has designated vendors that provide construction management services. You may, but are not required to, use construction management services and/or Sweetwaters’ designated vendors for construction management.
- The low end of this range assumes that you will manage the construction yourself. The high end of this range assumes that you will hire Sweetwaters’ designated vendor for construction management.
- If you engage a company besides Sweetwaters’ designated vendor, your costs may be higher.
14. Insurance – Liability and Workman’s Comp (3 Months): $950 to $1,200
15. Real Estate Costs – 3 Months’ Rent, Plus Security Deposit: $8,065 to $45,724
- The estimate is based on a Cafe that is between 1,100 to 1,800 square feet.
- If the Cafe is located within a shopping center, the landlord typically assesses additional charges to pay for the expenses associated with the center’s operation. These charges typically average between $1,000 and $4,500 (based on Sweetwaters’ experience).
- Sweetwaters currently has an approved supplier that you must use in connection with securing the premises of any Franchised Business you wish to open (whether pursuant to a single franchise purchase or to fulfill your development obligations under your Development Agreement).
16. Grand Opening Advertising: $5,000
- The Grand Opening Advertising Requirement must commence prior to when your Cafe opens, and you must expend at least $5,000.
- You may be required to expend all or some portion of your Grand Opening Advertising Requirement on marketing, advertising, or public relations materials/services that are purchased from 1 or more of Sweetwaters’ approved suppliers.
17. Additional Funds – 3 Months: $10,000 to $20,000
- This item estimates the funds needed to cover your initial expenses for the first 3 months of operation (other than the funds identified separately in the table). It includes payroll costs but not any draw or salary for you. However, this is only an estimate, and it is possible that you will need additional working capital during the first 3 months you operate your Cafe and for a longer time period after that.
18. Total: $264,144 to $636,038