Franchise Costs: Detailed Estimates of Slim Chickens Franchises Costs (2021 FDD)

Detailed Estimates of Slim Chickens Franchise Costs Based on Item 7 (Estimated Initial Investment) of Slim Chickens’ 2021 Franchise Disclosure Document

1.  Initial Franchise Fee:  $20,000

• The initial franchise fee for a single Restaurant is $20,000.

2.  Real Property/Site Lease/Site Review Fees:  $0 to $15,000

• Slim Chickens expects you will lease the real estate for your Restaurant. Purchasing the real estate for your Restaurant will make your total initial investment substantially higher.

• The cost of leasing or purchasing real estate will vary, depending on location and other factors such as whether there is an existing structure on the site.

• The low amount for real estate is based on you signing a real estate lease to build out an existing structure with commencement of rent on opening and paid through the first three months of operations (basing rent at approximately $15,000 to $17,000 per month).

• The high amount for real estate is based on your purchasing land between 0.75 and 1 acre at a one-time cost ranging from $500,000 to $1,200,000.

• Preferred locations for the Restaurants are prominent locations in heavily-populated suburban areas and/or “strip” shopping centers that have both significant household counts and significant daytime and nighttime business (typically retail and/or office), and in markets that are the center of a wide area of trading population.

• You may incur site review fees if you submit 3 or more sites to Slim Chickens for review.

3.  Construction/Site Work/Building Conversion:  $350,000 to $1,200,000

• Your Restaurant will be established in accordance with Slim Chickens’ current Restaurant designs.

• Building costs for Slim Chickens’ current Restaurant designs are expected to range from $130 to $300 per square foot, depending on whether you build out an existing structure or undergo new construction, and will vary by building size.

• Slim Chickens’ current Restaurant design consists of approximately 2,400 to 2,800 square feet of interior space and approximately 200 to 1,000 square feet of outdoor patio space.

• The low amount reflects a conversion of an existing restaurant building and inline spaces. The high amount reflects a prototype new build.

• These amounts assume that your landlord will not contribute to your build-out.

4.  Furniture, Fixtures, and Equipment:  $275,000 to $315,000

• The furniture, fixtures, and equipment costs are based on the costs charged by Slim Chickens’ vendors for the furniture, fixtures, and equipment required in all operations manuals, policy statements, directives, bulletins, and memoranda that contain prescribed or recommended standards, procedures, policies, and advice relating to a Restaurant’s operation and management and to market the products Restaurants serve, estimated to be $75 to $82 per square foot.

• The operations manuals disclose the principal elements of the System, and its contents are and will remain Slim Chickens’ exclusive property (collectively referred to as the “Brand Standards Manual”).

5.  Smallwares:  $12,000 to $14,000

• Smallwares include utensils, flatware, and all handheld equipment for use in food preparation, handling, and processing. They do not include furniture, fixtures, and major equipment.

6.  Building Signage and Interior Graphics:  $40,000 to $65,000

• Your signage costs will depend on whether you build a free-standing, endcap, or inline location and whether you have architectural, municipal, or lease restrictions on the signage you can use at your Restaurant. In all cases, you are required to meet or exceed Slim Chickens’ specifications for your signage unless you are restricted by local ordinance from meeting Slim Chickens’ specifications.

7.  Soft Costs:  $137,000 to $278,000

• Soft costs include necessary site work, permits, utility connection or “tap” fees plus all other fees imposed by federal, state, and/or local jurisdiction and which are necessary to obtain certificate of occupancy, architecture fees, meeting costs, title reports, legal services, soil analysis, printing of plans, and ancillary items.

8.  Insurance:  $9,000 to $15,000

• You must carry insurance as required in the Franchise Agreement. The amount represents Slim Chickens’ best estimate of the premiums required for commercial general liability, business automobile liability, employment practices liability, property, workers’ compensation, and umbrella liability insurance during a Restaurant’s first year of operation. However, your costs may vary from those described above.

9.  Opening Inventory:  $6,000 to $10,000

• Opening inventory consists of food, beer, wine, disposables, chemicals, cleaning supplies, and uniforms.

10.  Training Costs/Opening Assistance Reimbursement:  $23,000 to $39,000

• The amounts shown include estimated travel, lodging, meal, and incidental expenses for your Controlling Owner, your first Supervisor, and up to three other salaried managers to attend Slim Chickens’ required initial training program.

• This program will include training in a company-affiliated Restaurant to be approved by Slim Chickens. Such amounts will vary depending on the number of trainees that attend the initial training program, the distance traveled, method of travel, and choice of accommodations.

11.  POS System/Drive-Thru Components/Menu Boards:  $64,000 to $84,000

• Security and utility deposits include estimated deposits for leased premises and equipment, telephone service, and other utilities.

12.  Low Voltage/Security/Network Installation:  $32,000 to $38,000

13.  Security and Utility Deposits:  $2,500 to $12,000

14.  Business Licenses (excluding beer and wine license):  $400 to $2,000

• The range given provides Slim Chickens’ best estimate of the costs you will incur for business permits and miscellaneous deposits, excluding utility deposits which are included elsewhere herein. This amount does not include costs to obtain a beer and wine license, which will vary among jurisdictions.

15.  Grand Opening Ad Expenditure:  $10,000

• You must submit your grand opening advertising budget to Slim Chickens for approval before spending the Grand Opening Ad Expenditure. You must submit proof of the Grand Opening Ad Expenditure upon Slim Chickens’ request.

• The only circumstances where you may not be required to conduct a grand opening is if you have multiple existing Restaurants in close proximity to the new Restaurant and the marketing efforts at those Restaurants provide sufficient grand opening marketing for your new Restaurant.

16.  Additional Funds for 3 Months:  $40,000 to $65,000

• Additional funds include expenses for wages, occupancy costs, professional expenses, and other recurring expenses before the opening of the Restaurant, and during the first 3 months of operation.

17.  Total for a Single Franchise:  $1,065,900 to $3,367,000

• These figures are an estimate of your total opening and operating expenses for the initial 3 months of business. They are based on Slim Chickens’ current and past affiliates’ experience (including SCR and HSG) in constructing and operating Restaurants in Arkansas, Kansas, and Missouri since 2003. The costs in your region of the country will vary.

• Your expenses may also vary depending on the size and location of your Restaurant, your experience, the prevailing wage, your level of sales, the competition, and other factors, including landlord contributions, beer and wine costs, and whether you are converting an existing restaurant location to a Restaurant.