FDD Talk: What You Need to Know About the Mainstream Boutique Franchise Opportunity (Financial Performance Analysis, Costs and Fees)

In this FDD Talk post, you’ll learn the following:

• Section I – Background information on the Mainstream Boutique franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for a Mainstream Boutique franchise, based on Item 7 of the company’s 2017 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Mainstream Boutique franchise, based on Items 5 and 6 of the company’s 2017 FDD

• Section IV – Presentation and analysis of Mainstream Boutique’s financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:

• average, median, high, and low net revenues for the first, second, third, and fourth years of operation of the 50 fully-reporting first location franchised Mainstream Boutique Businesses that were in operation for at least 12 months as of December 31, 2016

Section I – Background Information

16 Things You Need to Know About the Mainstream Boutique Franchise

New Locations

1.  Mainstream Boutique has seen significant growth in the last five years. CEO Corey DeNicola said that the company’s long-term goal is to have 2,000 boutiques across the country and that Mainstream Boutique hopes to have at least 150 stores open by 2019.

2.  Over the past few months, the brand has opened two new locations: one in Riverview, Florida and another in Delafield, Wisconsin. The Florida boutique opened at the end of December 2017, while the Wisconsin store opened in early March.

3.  Jeanmarie Milla, the owner of the Mainstream Boutique in Riverview, celebrated the store’s ribbon cutting ceremony with the Greater Riverview Chamber of Commerce as well as her store’s staff, family, and friends. Milla said that she has wanted to own her own shop since she was a little girl.

4.  Milla also talked about how Mainstream Boutique empowers women, stating, “We are very honest. We want [women] to look and feel beautiful, not just sell them something. It’s my policy that if they try something on and it doesn’t look good on them, we’re going to tell them it doesn’t look good on them. I think that’s important to know you’re honest.”

5.  The Delafield Mainstream Boutique is owned and operated by Sarah Johnson, who has a degree
in retail merchandising from the University of Wisconsin-Madison and worked in the buying
department at Kohl’s for nine years. Like Milla, Johnson said she has always wanted to open her own store and was excited to have the opportunity to start her own Mainstream Boutique.

6.  The location she chose was previously a Mainstream Boutique, but it closed down when the owner retired. Johnson said that her experience working at Kohl’s gave her an advantage when she had only a month to purchase inventory for her Mainstream Boutique. She also said that she was looking forward to interacting with her customers.

Franchise Owner Writes Two Books to Help Children Overcome Bullying

7.  Rachel Chadima, one of the company’s newest franchisees who opened her Mainstream Boutique in 2016, wrote a book entitled Lessons from My Lunchbox: Overcoming the Bullies One Note at a Time, which is now sold in Mainstream Boutique stores and select Barnes & Noble stores in Minneapolis and St. Paul, Minnesota.

8.  Chadima was inspired to write the book after what she calls “the long-ignored bullying epidemic” had started gaining media attention in 2011. The book is filled with notes that Chadima’s mother used to leave in her lunchbox when she was a child. The notes provide encouragement to help kids overcome the hardships of their growing up years.

9.  In 2018, Chadima and her mother released a follow-up book, Lessons for Their Lunchbox, which features 180 lunchbox notes that can be torn off and put into a child’s lunchbox. The book is now available on Chadima’s website and Mainstream Boutique stores.

Exclusive Multi-Generational Line Celebrates Mother and Daughter Bond

10.  Over the years, Mainstream Boutique has become a family-run business, with Marie DeNicola’s son Corey serving as the company’s CEO and her other son Clay working as Franchise Support Manager.

11.  DeNicola’s only daughter Mikayla (who is called Mac) now works beside her mom in creating and designing and was the inspiration behind Mainstream Boutique’s private label brand, Mac and Me. The exclusive clothing line was created in 2014 as a multi-generational line that is about love, fun, fashion, and celebrating the inseparable bond between mother and daughter.

12.  The line’s hangtags have authentic quotes from both DeNicola and Mac about one another. Since its launch, Mac and Me has become Mainstream Boutique’s number one line and generates about $4 million to $5 million each year.

Company History

13.  Mainstream Boutique was founded in 1991 by Marie DeNicola in Minnesota. DeNicola had previously worked in the Los Angeles garment district as a buyer, merchandiser, and planner. She left the corporate world when her husband’s job took them to Minnesota.

14.  DeNicola wanted to find a way to use her education, job experience as a buyer in the fashion industry, and her love for women and all things fashion. She decided to start a direct-sales company selling apparel and accessories from her bedroom and named it Mainstream Boutique because she lived on Mainstream Circle.

15.  DeNicola started franchising in 1998 after appearing on the Oprah Winfrey Show in 1995 to discuss her successful business. Today, there are over 85 Mainstream Boutique locations across 22 states.

Entrepreneur’s Franchise 500

16.  Mainstream Boutique has ranked on Entrepreneur’s annual Franchise 500 list every year since 2013. The brand’s highest rank was No. 155 in 2018, while its lowest rank was No. 416 in 2014.

Section II – Estimated Costs

• Please click here for detailed estimates of Mainstream Boutique franchise costs, based on Item 7 of the company’s 2017 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on Mainstream Boutique’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.

Section IV – Financial Performance Representations (Item 19, 2017 FDD) and Analysis

• The information included in the table below is based on reports submitted to Mainstream by 50 fully-reporting first location franchised Mainstream Boutique Businesses that were in operation for at least 12 months as of December 31, 2016.

• The information for the Mainstream Boutique Businesses contained herein does not include data for the:

• (i) franchised Mainstream Boutique Businesses opened during the 2016 calendar year ended December 31, 2016 (and therefore do not have a full 12 months of operating history);
• (ii) 2 Mainstream Boutique Businesses operating seasonally and not reporting revenue for the full 52 weeks of 2016;
• (iii) 7 franchised Mainstream Boutique Businesses opened as a second retail location for existing franchisees;
• (iv) any Mainstream Boutique Businesses operated by Mainstream or its affiliates; and
• (v) any Mainstream Boutique Businesses that have ceased operations.

• The information for the franchised Mainstream Boutique Businesses was collected by Mainstream, but has not been independently audited or verified by Mainstream.

• The table below includes the average, median, and range of Net Revenues for certain Mainstream Boutique Businesses for their first through fourth year of operation. The table also includes the number of Mainstream Boutique Businesses that met or exceeded that average Net Revenue.

• The financial performance representations in this Item 19 do not reflect the cost of revenues, operating expenses, or other costs or expenses that must be deducted from the Net Revenue or gross sales figures to obtain your net income or profit.

• As used in the table below, “Net Revenues” include all revenues received by the Mainstream Boutique business, except discounts (up to pre-approved amounts established by Mainstream) to hosts, customers, and employees, product returns, credits, refunds, or sales taxes, as reported to Mainstream.

• Mainstream has not audited the reported Net Revenues.

• Some of the Businesses included in the table below have been in operation for over 15 years so the Net Revenues reflected in their first 4 years in operation were reported to Mainstream 10-15 years ago, and may be impacted by different economic times, standards, specifications, and operating procedures.

Year One