Senior Helpers Franchise Costs: Estimated Initial Investment (Item 7, 2022 FDD)
1. Initial Franchise Fee: $55,000
- The initial franchise fee is $55,000 and is paid when you sign the Franchise Agreement.
- The franchisor has offered to finance the initial franchise fee for certain exceptional franchisees to purchase an additional franchised business.
2. Travel and Living Expenses While Training: $1,500 to $3,000
- You will pay for all travel and living expenses which you (or your Operating Principal) and all of your employees incur, and for your employees’ wages and workers’ compensation insurance while they are training. The costs will depend on the distance you must travel and the type of accommodations you choose.
- The franchisor will provide the initial training program at its franchise administrative office (currently Towson, Maryland) or at a designated training facility of the franchisor’s choice.
- The low estimate assumes that you live within driving distance of the franchisor’s headquarters or the designated training facility; the high estimate assumes that you will incur costs for lodging, food, and travel for the training period.
3. Lease, Utility, and Security Deposits: $3,000 to $4,000
- You must operate from an office within your Territory. The franchisor expects that you will need approximately 1,000 square feet for the office.
- Offices must contain signage and a separate area for training that is not part of shared space.
- Lease costs will vary with real estate costs in each market.
- You are responsible for obtaining all necessary permits or licenses necessary for the site locating, renovation, and operation of the Franchised Business.
- Prepaid rent and security deposits are generally required by landlords, utilities, and certain other merchants or government entities.
- The high end of this estimated cost includes a one-month security deposit. Based on the franchisor’s experience, it has found that prepaid rent is generally nonrefundable. Security or other deposits may be refundable either in full or in part, depending on your lease or contract.
4. Leasehold Improvements: $2,500 to $6,500
- Leasehold improvements will vary with many factors, including the size and conditions of the Premises.
5. Promotional Items: $2,000 to $4,000
- You will need to order promotional items from an approved vendor, such as coffee mugs, pens, note pads, candy jars, etc. that will be used to help market your franchise in your territory. These costs will include printing services for promotional items.
6. Additional Staffing: $22,000 to $25,000
- You will need to hire a full-time office support person and marketing person initially to help you with scheduling and other office administrative duties and marketing initiatives. This will need to be done at opening and will help you to establish your business quicker than doing it by yourself.
7. Furniture, Fixtures, and Equipment (Including Computer System): $5,000 to $7,000
- You may need to purchase furniture and fixtures (e.g., desks and chairs) for the Premises.
- Financing may be available for some of your leasehold improvements, fixtures, signage, and furnishings through lessors or third parties. If you finance these items, you will incur financing costs.
- The low end of the estimates for line items “Signage” and “Furniture and Fixtures” reflects the lessor’s contribution to the full costs of “Signage” and “Furniture and Fixtures.”
- The equipment cost estimate includes costs for communications equipment, computer hardware (computer – server, computer – client, printer/fax multi-function), and the costs of obtaining the required software the franchisor specifies from time to time.
- Telephone and Internet connection service may cost approximately $50 to $300 per month.
- Included in these estimated costs are three monthly payments of the software license fee and LIFE Profile license.
- The franchisor and its affiliates may charge you a monthly fee or other fees for certain information technology related costs such as Relias, FranConnect access, Online Web Hosting/SEO, Applicant Tracking System, and e-mail.
- The current IT Fee is $275 per month. The franchisor expects that this fee will begin to be incurred during your first month of operations.
- You will need to install indoor signage in the Premises and outdoor signage in connection with the operation of a Franchised Business. Currently, neither the franchisor nor its affiliates are suppliers of signage.
8. Supplies: $700 to $1,500
- The estimates for this line item reflect the costs of various office supplies you will need in connection with the operation of the Franchised Business.
9. Initial Advertising: $3,000 to $6,000
- The franchisor strongly recommends that you conduct advertising, marketing, and promotional campaigns just prior to opening your Franchised Business and during the first few months of operations. The franchisor can help you develop these initial advertising plans and programs.
- The franchisor recommends that you spend approximately $3,000 to $6,000 on this initial advertising.
10. Business License and Permits: $0 to $12,500
- You may be required to obtain a business license or permit before you can open the Franchised Business.
11. Legal and Professional Fees: $100 to $1,300
- The franchisor believes that it is important for you to consult with your own accountant, attorney, risk management, and/or business advisor before making any decision to enter into a Franchise Agreement with it.
- You should also use an attorney or other business advisor to review any lease or other agreements that you enter in connection with your Franchised Business or other independent business relationship.
12. Insurance: $3,500 to $5,000
- This is an estimate of your initial insurance premium for required property and public liability insurance. Your costs will vary depending on your market, the amount of coverage you select, your insurance carrier, and other factors. The cost of other coverage, including workers’ compensation and other types of coverage cannot be estimated as they vary widely on a market-by-market basis.
- The franchisor sets minimum insurance requirements for its Senior Helpers Care Businesses but it recommends that you seek the advice of an independent risk management professional and/or insurance broker to determine the additional coverage you should have in place for the business.
13. Recruitment: $1,000 to $2,000
- This is an estimate for your recruitment of the employees and caregivers of the Franchised Business.
14. Additional Funds for 3 Months: $26,500 to $37,000
- This is an estimate only for the additional operating capital needed to operate your Franchised Business during the initial 3 months after you open for business. The franchisor cannot guarantee that you will not have additional expenses starting the business.
- The estimate includes items such as initial payroll and payroll taxes (including payroll to cover the pre-opening training period for some of your Franchised Business staff), continuing service and royalty fees, Marketing Fund contributions, professional fees (including accounting and computer fees), additional advertising, rent, repairs and maintenance, bank charges, IT fees, miscellaneous supplies and equipment, state tax and license fees, depreciation/amortization, deposits and prepaid expenses (if applicable), and other miscellaneous items.
- Additional operating expenses will be incurred in connection with the ongoing operation of your Franchised Business, and periodic reinvestment will be necessary following the initial start-up phase for leasehold improvements, equipment, fixtures, and other assets.
15. Total: $125,800 to $169,800
- The franchisor has relied on data from its experience in the care business to compile these estimates.