Updated October 6, 2021.
Detailed Estimates of YogaSix Franchise Costs Based on Item 7 (Estimated Initial Investment) of YogaSix’s 2021 Franchise Disclosure Document
1. Initial Franchise Fee: $60,000
- The Initial Franchise Fee for a single Studio is $60,000. The Initial Franchise Fee is non-refundable. YogaSix does not provide financing for the Initial Franchise Fee.
2. Travel and Living Expenses While Owner/Operator and/or Designated Manager Modules of Initial Training Program: $500 to $3,000
- This estimate is designed to cover the costs and expenses you might incur in connection with you (or if you are an entity, one of your operating principals you designate to be the Designated Operator for the Studio) attending and completing the required initial training.
- YogaSix will not charge you or your Designated Operator for this portion of its initial training that must completed on behalf of the franchisee/owner under your Franchise Agreement. You will be responsible for the costs and expenses associated with attending this training (e.g., transportation, meals, lodging, and other expenses).
- The estimate assumes that you will attend training at YogaSix’s headquarters.
3. Real Estate/Lease: $16,500 to $37,500
- If you do not own adequate Studio space, you must lease suitable premises. These figures assume that the leased premises will be approximately 2,000 square feet.
- Landlords may also vary the base rental rate and charge rent based on a percentage of gross sales. In addition to base rent, the lease may require you to pay common area maintenance charges (“CAM Charges”), your pro rata share of the real estate taxes and insurance, and your pro rata share of HVAC and trash removal.
- You will also likely be required to pay a security deposit. This estimate assumes your security deposit will amount to approximately 1 month of rent.
4. Leasehold Improvements: $105,900 to $266,000
- You must adapt YogaSix’s prototypical plans and specifications for the construction and finish-out of the Studio, including approved flooring, mirrors, and paint.
- This estimate assumes that your Studio will be approximately 2,000 square feet in size, and includes the cost of installing certain of the furniture, equipment, or fixtures required to complete the build-out of your Studio, as well as utility deposits, if any, that you may incur. This estimate also covers the expense to acquire the required local business permits, including building permits, fire inspection, sales tax permit, and retail sales permits.
- The low end of this estimate assumes a tenant contribution from the landlord of the approved premises that is consistent with YogaSix’s prior experience and the estimates it has received from certain of its Approved Suppliers, while the high end of the estimate does not assume such a credit.
- The low end of the range reflects modest improvements to a smaller location, and the high end reflects significant physical improvements to a larger Studio.
- YogaSix’s standard franchise offering assumes (a) that your landlord will provide certain tenant improvement credits or allowances (or comparable compensation) in connection with the buildout or otherwise under the lease for the approved premises of your franchised Studio, and (b) you will not enter into a lease without negotiating such a reasonable tenant improvement allowance (based on the overall general contractor quote associated with the buildout).
- With that said, YogaSix may permit you to enter into a lease that does not afford such credits or allowances or comparable compensation from the landlord under you lease, provided you sign an acknowledgement that such lease and buildout terms are outside YogaSix’s standard franchise offering and System standards and specifications for your premises.
5. Signage and Graphics: $8,000 to $19,000
- You must purchase all signage and graphics directly from YogaSix’s Approved Supplier.
- The cost of your signage may be more or less than this estimate, and depends on the number, size, type, and method of installation you choose. Each landlord has different restrictions it places on interior and exterior signage that may affect your costs.
6. Insurance: $1,500 to $2,500
- This estimate is for 3 months of your minimum required insurance, using YogaSix’s required or approved third-party vendor. The actual cost may be more than shown here. You will need to check with YogaSix’s insurance carrier for actual premium quotes and costs, and for the actual amount of deposit.
7. Fitness Equipment Package – Deposit and Lease-to-Own Payments Over First 3 Months of Operation: $2,500 to $10,500
- The initial required package for a standard franchised Studio includes the millwork/furniture package, certain other furniture and fixtures, along with the equipment bundle which includes various equipment/supplies for use in connection with the provision of the Approved Services such as resistance bands/straps, interval training equipment, and weights, as well as certain other equipment used in connection with the Studio.
- This estimate assumes that you will acquire this package of equipment, as well as certain fixtures and equipment, via a lease-to-own or comparable financing program. Both the low-end and the high-end numbers represent leasing of all furniture, fixtures, and related supplies (rather than purchasing these items).
8. Pre-Sale and Soft Opening Retail Inventory Package: $12,000
- The typical for-sale items held in opening inventory are the apparel and other branded merchandise that you will be permitted to resell at your Studio as part of your Approved Products, including items such as t-shirts, towels, exercise clothing, yoga mats, and related accessories.
9. Audio/Visual Package and Computer Equipment: $48,000
- You must use YogaSix’s Approved Supplier for the purchase of your audio/visual equipment package (the “AV Package”) and the computer system components YogaSix requires you to utilize in connection with your Franchised Business, including but not limited to, a personal computer and the Point of Sale system (“POS”) hardware and software for use in the operation of the Studio.
- YogaSix will make available to you a certain business management software program specific for the Studio to be loaded on to your system. You will pay the third-party vendor directly for all fees associated with the use of the software.
- In addition to the POS and related computer equipment, you must acquire speakers, cabling and mounts, and other audio-visual related equipment and accessories necessary to provide the Approved Services.
- You are required to have at least 1 surveillance camera installed in the Studio. The camera(s) must be web accessible. You will use the camera to monitor teacher performance, quality assurance, and safety.
- YogaSix has an absolute right to also review and monitor the camera(s) for the same purposes as you, and to ensure compliance with the System. You are responsible for ensuring customer consent and for any failure to obtain such consent.
- You must indemnify YogaSix for any breaches of privacy from your use of any surveillance camera.
10. Pre-Opening Marketing: $15,000
- You are required to expend this “Initial Marketing Spend” in coordination with the pre-opening sales plan YogaSix approves or designates for your Studio as part of the opening support program that YogaSix’s approved supplier provides in connection with your Studio, as YogaSix determines appropriate in its discretion (the “Opening Support Program”).
- Typically, YogaSix expects your Opening Support Program to commence prior to the “soft opening” of your franchised Studio through your actual opening of the Studio. These funds must be expended on your Opening Support Program and any other pre-opening marketing and/or advertising activities YogaSix designates.
- This estimate is in addition to your required contributions to the Fund.
11. Tech Fee(s) – 3 Months and 1 Month Prior to Opening: $720
- This estimate is designed to cover YogaSix’s current Technology Fee obligations prior to opening and over the first 3 months of operation, for a total of 4 months of payments.
12. Bridge Training: $3,000 to $4,500
- This is YogaSix’s then-current Training Fee for the Bridge Training that the standard franchise offering assumes and expects will be provided to you and your initial staff of Authorized Instructors at the premises of your franchised Studio prior to its soft opening, either via (a) remote instruction, or (b) an Authorized YTT Facilitator that YogaSix sends to your franchised Studio to provide this training to your staff of Authorized Instructors in-person and on-site at your Authorized Location.
- The low end of this estimate assumes that this Bridge Training will be provided and completed via YogaSix’s proprietary remote instruction materials and program, while the high end assumes that YogaSix will be sending you one of its Authorized YTT Facilitators to provide Bridge Training on-site and in-person at your Franchised Business.
- The additional amounts associated with the high end are to cover the travel-related costs associated with YogaSix’s Authorized YTT Facilitator providing the Bridge Training in-person at your franchised Studio, including flight, lodging, and meals.
13. Additional Funds – First 3 Months: $15,000 to $20,000
- This is an estimate of certain funds needed to cover your business (not personal) expenses during the first 3 months of operation of the Studio. These expenses include initial personnel wages; potential Teacher Training Tuition(s) if you decide to cover such fees on behalf of your initial instructors; ongoing purchases of equipment and supplies; marketing expenses/fees and local advertising; ongoing utilities (other than initial deposits); and repairs and maintenance.
14. Total: $288,620 to $498,720
- In preparing each of the ranges and figures for this Item, Yoga Six relied in part on: (i) its experience in franchising since its inception and the experience of its System franchisees based on reports and other information they provide; (ii) the experience of its sister brands in developing other fitness concepts and information related to their respective studio investment costs; and (iii) current estimates it has received from its Approved Suppliers and other third-party vendors and/or franchisee reported information.