QC Kinetix Franchise Costs: Estimated Initial Investment (Item 7, 2022 FDD)

1.  Initial Franchise Fee:  $55,000

• The Initial Franchise Fee is $55,000 for a defined territory which includes certain training. The initial franchise fee is payable in full when you sign the Franchise Agreement.

• If QC Kinetix, in its discretion, decides to enter into a Development Agreement with you, you will pay QC Kinetix an initial nonrefundable development fee, which is negotiated on a case-by-case basis.

2.  Leasehold Improvements:  $10,000 to $60,000

• QC Kinetix suggests you find a space needing minimal leasehold improvements.

• In most cases, you will need to alter the interior of your Business before you open for operation in order to meet QC Kinetix brand standards. The costs will vary widely and may be significantly higher than what is projected above depending on factors such as property location, the condition of the property, and the extent of alterations required for the property.

• The higher end of the cost estimate reflects the potential need to add bathrooms, lighting, fire sprinklers, fire alarms, and an HVAC system that entails mechanical, electrical, and plumbing costs.

• The range above reflects estimated costs to franchisees after any improvement costs are paid for, or reimbursed by, the landlord.

• The costs to construct interior alterations, improvements, lighting, and decorating the facility will depend on the extent of the renovations needed and any allowance you negotiate with your landlord for construction.

• These are estimated expenses for all furniture and fixtures necessary for the operation of your Business.

3.  Utilities and Security Deposits:  $5,000 to $10,000

• A typical QC Kinetix Business is in a Class-A office space/medical space with a minimum of 1,700 square feet of space, but the range is between 1,700 and 2,500 square feet. The low estimate represents rents for a three-month period for a 1,700 square foot space at $20 per square foot. The high estimate assumes three-months’ rent for a 2,500 square foot space at $40 per square foot.

• The rent estimates include amounts for common area maintenance, insurance, and taxes, but these amounts vary greatly depending on the market.

• Real estate costs depend on location, size, visibility, economic conditions, accessibility, and competitive market conditions.

• These sums do not include the costs to purchase real property, as QC Kinetix does not expect you to buy real property. Lease payments for periods of time that you occupy your premises may not be refundable.

4.  3-Months’ Rent:  $8,500 to $25,000

5.  Signage:  $1,500 to $2,500

• These are the estimated costs for the delivery and installation of exterior and interior signage.

6.  Furniture and Fixtures:  $9,000 to $12,000

• You must purchase or lease and install fixtures, tables and chairs, equipment (including a cash register), POS system, camera system, audio and visual equipment, and decor necessary to operate your QC Kinetix facility.

• The cost of the furniture, fixtures, and equipment will vary according to local market conditions, the size of the QC Kinetix facility, suppliers, and other related factors.

• The figures above are for purchasing the furniture, fixtures, and equipment.

7.  Computers, Office Equipment, and Supplies:  $5,000 to $8,000

• This includes a phone and a desktop or laptop computer and scanner/printer as well as required software.

• The required specifications for the computer include Office 365, Quickbooks Online, Anti-Virus Software, Windows, and printer with scanner capabilities as provided in the Operations Manual.

• This also includes costs for business cards, forms, branded office supplies, marketing materials, and related items.

8.  Medical Related Equipment:  $8,000 to $10,000

• One Class 4 laser, centrifuge, and ultrasound.

• Low amount assumes lease or finance for 6 months.

• You may purchase an x-ray machine, but this expenditure is optional, not mandatory. This expense is not included in this range.

9.  Medical Related Training:  $1,800 to $3,600

10.  Business Licenses, Permits:  $500 to $1,500

• You must maintain all required licenses, permits, and certifications necessary to operate your franchise. You should check with local authorities, and an attorney or business consultant to determine what licenses, permits, and certifications are necessary at your location.

• The amount for licenses, permits, and certifications can vary significantly in different areas, and you should verify specific amounts with local authorities.

11.  Professional Fees:  $2,000 to $7,500

12.  Initial Inventory (Retail Items):  $2,000 to $3,000

• You must purchase a variety of different products, marketing, and promotional materials for the general operation of the franchised business as specified in the Operations Manual.

• Your initial inventory of products will vary according to the size of your Business, availability of products, your decisions regarding the appropriate mix of products for your market, and current market prices.

• You must offer and purchase products that meet QC Kinetix’s specifications, which may change from time to time.

• All items mentioned above must be purchased through QC Kinetix, its affiliates, or its approved vendors and suppliers, except all marketing and promotional materials must be purchased directly from QC Kinetix.

13.  Business Insurance:  $5,600 to $22,500

• This estimated amount represents 3 months of pre-paid insurance premiums that does not take into account workers’ compensation insurance which may vary greatly by state, payroll, and classification.

14.  Training Expenses:  $3,000 to $5,000

• Training may be held at QC Kinetix’s corporate headquarters, at your Business location, at another franchisee’s location, or remotely. You are responsible for all costs associated with attending, such as travel, room, and board for each person.

• Estimates provided are costs for 2 people for 4 days.

• Training for additional people is available at your request for an additional training fee of $1,000 per person.

15.  Salesforce Setup Fee:  $1,500

16.  Webpage Setup Fee:  $1,250

17.  Form Setup Fee:  $480

18.  Additional Funds (3 months):  $100,000

• This amount is an estimate of additional funds for expenses you may incur before operations begin and during the initial period of operations (typically, your first 3 months of operating the Business) (e.g. additional working capital). The 3-month period from beginning your Business does not necessarily mean that you will have reached “break-even,” “positive cash flow,” or any other financial position.

19.  Total:  $220,130 to $328,830

• The total estimated initial investment is an estimate only of the range of startup expenses you may incur. QC Kinetix relied on its combined experience of running the affiliate locations when preparing these figures.

• The estimate of initial investment funds is based on an owner-operated business and does not include salaries or benefits for full-time employees. As your QC Kinetix Business grows, you may choose to hire additional employees to carry out support service tasks.