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

• Section I – Background information on the Best in Class Education Center franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for a Best in Class Education Center franchise, based on Item 7 of the company’s 2018 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Best in Class Education Center franchise, based on Items 5 and 6 of the company’s 2018 FDD

• Section IV – Number of franchised and company-owned Best in Class Education Center outlets at the start of the year and the end of the year for 2015, 2016, and 2017, based on Item 20 of the company’s 2018 FDD

• Section V – Presentation and analysis of Best in Class Education Center’s financial performance representations, based on Item 19 of the company’s 2018 FDD, including information on the:

• 2017 average, median, highest, and lowest total revenues for the 18 franchised Best in Class Education Centers that (i) have been in operation for a period of at least 2 years as of December 31, 2017 (i.e., opened by January 1, 2016); (ii) have operated for the entire 2016 and 2017 calendar years; and (iii) were not a “satellite location”

• 2017 average, median, highest, and lowest total revenues for the 6 affiliate-owned Best in Class Education Centers that (i) have been in operation for a period of at least 2 years as of December 31, 2017 (i.e., opened by January 1, 2016); and (ii) have operated for the entire 2016 and 2017 calendar years (2 of these outlets are satellite locations)

Section I – Background Information

17 Things You Need to Know About the Best in Class Education Center Franchise

On Track to Open 18 Franchises in 2018

1.  Before the start of 2018, Best in Class Education Center set a goal of opening 16 new centers by the end of the year. By October, Best in Class had opened 16 locations in 2018, and in early November, the company announced that it was on track to open another three before the end of the year.

2.  Sharon Peterson, vice president of franchise recruitment and development for Best in Class Education Center, said, “We are thrilled with the growth we have seen this year. Not only are we going to meet our goal, we are likely to exceed it and close out the year with 18 locations.”

3.  One of Best in Class’s new franchise owners is Dr. Alissa Gardenhire, who opened her location in South Orange, New Jersey in February. Like many Best in Class franchisees, Gardenhire had a career in education before joining the franchise, but she had never owned a business. Gardenhire said she has always enjoyed her work, but she had an entrepreneurial drive that hadn’t been fulfilled, so she “decided life was short,” and quit her job to find a business she could run for herself.

4.  Just a few months after leaving her job, Gardenhire was researching franchise brands in her field and came across Best in Class. She was immediately impressed by the dedication she saw at every level of the franchise’s corporate team, including Best in Class’s CEO, Has Lam, who made a special trip to meet Gardenhire to discuss the opportunity.

5.  Gardenhire added, “I was so impressed with the business and the leadership. No other CEOs were flying out to meet me. After some due diligence, I was convinced it was the right opportunity, and I bought in.”

6.  According to Best in Class, not all of its 2018 openings are coming from new owners. Six were opened by existing, multi-unit franchisees. Peterson said more than 60 percent of the brand’s franchisees are multi-unit owners, and many are still expanding.

7.  This year, Best in Class opened new centers in Southern California, Georgia, Florida, and many other markets. For 2019, Best in Class is targeting even more new and existing territories, including Dallas, Austin, Charlotte, Raleigh, Los Angeles, Cincinnati, Central Florida, Northeast New Jersey, and Northern Virginia. Peterson said her team is hoping to hit those markets and more with 20 new franchise centers in 2019.

Announces Expanded Nationwide Relationship With FranNet

8.  At the end of April 2017, Best in Class Education Center announced that it was extending its partnership with FranNet, North America’s most respected leader in matching individuals with franchise ownership opportunities. Best in Class and FranNet have been working together since 2014 to help franchise candidates find success within the Best in Class system.

9.  According to Hao Lam, CEO of Best in Class, the reason the relationship has been so beneficial is because the FranNet team has come to deeply understand the Best in Class concept and the traits that will produce the most effective candidates. By leveraging that knowledge, FranNet consultants and Best in Class are able to work together to create the perfect, most impactful match.

10.  Now, after finding success in regional markets thanks to FranNet’s team, Best in Class is proud to announce that this partnership has now expanded nationwide.

11.  Jania Bailey, CEO of FranNet, said, “A lot of our clients are looking for a franchise that has a proven, consistent track record, solid operations, strong growth potential and a service they can feel proud of. With 40 locations and counting, recommending Best in Class to prospective franchisees who fit the particular profile for them is easy for us. While this is a young franchise concept, the interest and buzz surrounding the brand is picking up speed at a rapid rate, and we believe the growth potential is nearly limitless.”

12.  Best in Class has already found success with FranNet in markets like Texas and New Jersey. With FranNet’s help, Best in Class has successfully signed five Texas locations over the past few years. Lam added, “We’ve seen the excitement and energy here in Texas ever since we opened our first location in Katy back in 2013, and we’re thrilled to see the same momentum backing Best in Class throughout the region and beyond.”

13.  Now, as Best in Class expands its partnership with FranNet nationwide, the brand is aiming to grow and develop in both new and existing markets. At the time of the announcement, Best in Class had centers opened in California, New Jersey, Ohio, Oregon, Washington, Texas, Florida, Maryland, and Nevada and was looking to expand in Texas and California, as well as Ohio, New York, and New Jersey.

14.  According to Lam, “In the end, Best in Class is a business that people can feel proud of. And that’s an intangible element that you could never put a value on. Through this nationwide partnership with FranNet, Best in Class is poised to impact the lives of even more families throughout the country, and we’re excited to see what 2017 has in store.”

Company History

15.  Best in Class Education Center was founded in 1995 by Hao Lam and his wife Lisa Lam in Seattle, Washington. Both of the Lams fled Vietnam’s communist government in the late 1980s and lived in British Columbia, Canada for many years. Hao Lam put himself through school at the University of British Columbia and graduated with a BA in Mathematics. While Hao was in school, he often tutored his classmates and this was when Hao knew that helping others with their education was his passion.

16.  The Lams started franchising the Best in Class Education Center concept in 2011 and have continued to expand the business across the United States since then. Hao Lam continues to serve as the CEO of Best in Class and says that he regularly puts in 14-hour days in an effort to build a better company.

Entrepreneur’s Franchise 500

17.  Best in Class Education Center ranked No. 248 on Entrepreneur’s 2018 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of Best in Class Education Center franchise costs, based on Item 7 of the company’s 2018 FDD.

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

• Please click here for detailed information on Best in Class Education Center’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2018 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2015

• Outlets at the Start of the Year:  29
• Outlets at the End of the Year:  31
• Net Change:  +2

2016

• Outlets at the Start of the Year:  31
• Outlets at the End of the Year:  44
• Net Change:  +13

2017

• Outlets at the Start of the Year:  44
• Outlets at the End of the Year:  47
• Net Change:  +3

Company-Owned

2015

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2016

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2017

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

Section V – Financial Performance Representations (Item 19, 2018 FDD) and Analysis

• The following presents certain financial performance information for the 2017 calendar year for each Best in Class Education Center that met certain qualifying criteria (referred to as a “Qualifying Center”).

• In order to be a Qualifying Center, the Best in Class Education Center must: (i) have been in operation for a period of at least 2 years as of December 31, 2017 (i.e., opened by January 1, 2016); (ii) have operated for the entire 2016 and 2017 calendar years; and (iii) not be a “satellite location.”

• “Satellite locations” are materially different from traditional Best in Class Education Centers. For example, satellite locations are rented on an hourly basis (including from community centers, Boys and Girls Club, and in one instance, a Swerve Driving School) and do not have the signage, furniture, or equipment utilized at a traditional Best in Class Education Center.

• Qualifying Centers include Best in Class Education Centers operated by Hao Lam, the franchisor’s Manager and Chairman, as well as Best in Class Education Centers operated by third-party franchisees.

• On January 1, 2018, there were: (i) 47 Best in Class Education Centers operated by third-party  franchisees, and 18 of these centers are Qualifying Centers; and (ii) 8 Best in Class Education Centers operated by Hao Lam, and 6 of these centers are Qualifying Centers (2 of these outlets are satellite locations).

• The financial performance representations below include data from all Qualifying Centers.

Part 1 – Affiliate-Owned Qualifying Centers

• The financial information presented below is for the 2017 calendar year for Qualifying Centers operated by Hao Lam.

Highest Total Revenues