Dogtopia Franchise Costs: Estimated Initial Investment (Item 7, 2021 FDD)
- For purposes of the estimated initial investment figures below, Dogtopia has assumed that you are not a Conversion Franchisee. If you are a Conversion Franchisee, Dogtopia anticipates your total initial investment will be less.
1. Initial Franchise Fee: $40,095 to $49,500
- Dogtopia’s standard initial franchise fee is $49,500. If you are a qualified veteran purchasing your first franchise or you are a non-veteran purchasing your second or subsequent franchise, you will pay Dogtopia a discounted initial franchise fee of $44,550. If you are a qualified veteran purchasing your second or subsequent franchise, you will pay Dogtopia a discounted initial franchise fee of $40,095.
2. Initial Training Fee: $0 to $2,000
- Dogtopia will conduct its initial training program for up to 3 people at no additional charge. Dogtopia reserves the right to charge you a training fee of $2,000 for each additional person that attends its initial training program.
- The low estimate assumes you will send 3 people to training and the high estimate assumes you will send 4 people to training.
- In the past, Dogtopia has never charged the additional training fee, even when franchisees send more than 3 people to initial training.
3. Food, Lodging, and Travel (3-4 people while training): $1,000 to $12,000
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4. Utility and Security Deposits: $5,500 to $17,500
- This includes your estimated costs for utilities deposits charged by utilities company.
5. Real Estate and Facility Coordination Fee: $35,000 to $44,500
- You must pay Dogtopia a Real Estate and Facility Coordination Fee. The amount of the fee varies depending on whether you are a Conversion Franchisee and whether you own the real property for your facility at the time you sign the Franchise Agreement.
6. 3 Months’ Rent: $17,400 to $45,600
- These figures presume that you will be leasing your premises. Dogtopia anticipates that most Dogtopia facilities will range in size from 3,000 to 10,000 square feet. Dogtopia estimates that rent will range from $5,800 to $15,200 per month, although your actual rent may vary significantly above or below this range depending on your area and the local market conditions.
- Dogtopia’s suggested target rental rate for a Dogtopia facility is $10,000 per month.
7. Leasehold Improvements: $294,323 to $918,821
- You may be able to negotiate various terms with your landlord, including paying for some of the buildout costs (known as tenant improvement (TI) allowances). Also, you may seek to finance some or all of your buildout costs through your landlord or other financing sources.
- During 2020, 18 out of 19 franchisees received landlord contributions towards buildout costs. The amount of these TI allowances ranged from a low of $18,000 to a high of $721,280, with an average landlord contribution equal to 32% of the buildout costs.
- The low estimate above assumes a 32% landlord TI allowance (reducing the low estimate from $432,828 to $294,323) while the high estimate assumes no landlord contribution towards buildout costs.
8. Furniture, Furnishings, and Equipment: $29,500 to $60,500
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- You must purchase all furniture, fixtures, and equipment that Dogtopia specifies. If you lease furniture and/or equipment, your initial investment may decrease.
9. Exterior Signage and Graphics: $10,000 to $45,000
- This estimates the cost of your exterior signage and exterior graphics that are displayed on the exterior windows of your building.
10. Interior Signage and Graphics: $15,000 to $35,000
- This estimate includes the cost of all interior signage and graphics that are permanently affixed to the property. The estimate includes customization of the signage and graphics as well as installation. Certain interior signage is mandatory while other signage is optional.
- The estimate above includes the base package, installation, and optional upgrades.
11. Microsite and Social Media Account Set-Up Fee: $500
12. Technology Systems: $8,550 to $27,600
- This estimates your initial costs to acquire and install Dogtopia’s required Technology Systems, including: (i) your alarm/surveillance system ($800 to $10,000); (ii) your music system ($0 to $2,000); (iii) your computer and POS system ($1,000 to $4,000); (iv) your Nest cameras ($300 to $1,000); (v) your Apple TVs ($450 to $600); and (vi) your digital signage including 2 digital display monitors ($6,000 to $10,000).
- Some franchisees choose to lease their digital signage. If you lease, your initial investment will decrease.
- You must purchase an alarm and surveillance system that meets Dogtopia’s standards and specifications.
- The low estimate assumes you purchase an alarm and surveillance system that meets Dogtopia’s minimum requirements while the high estimate assumes you choose to upgrade your system.
- This estimate also includes the cost to purchase and install a system to play music in your facility. The music system is optional, although most franchisees choose to purchase and utilize the music system. If you choose to do so, you may need to pay music licensing fees.
- The Nest cameras are placed in the playrooms to allow pet parents to remotely monitor their pets. Your Apple TVs will be placed in the lobby to provide real time views of the playrooms. The estimate above assumes you will purchase between 3 and 10 Nest cameras and 3 to 4 Apple TVs.
13. Technology Fees (pre-opening period): $1,225 to $3,180
- From the time you sign the Franchise Agreement until your opening date, you must pay Dogtopia a monthly technology fee of $175 per month for a standard technology package. After opening, the standard monthly technology fee increases to $275 per month.
- In addition to Dogtopia’s standard technology package, you have the option to purchase the following packages: (i) Email Package (additional $50 per month); and (ii) Power BI Package (additional $40 per month).
- The low estimate assumes you are a non-conversion franchisee and you purchase the standard technology package. The high estimate assumes you are a non-conversion franchisee and you purchase the standard technology package as well as the optional Email Package and Power BI Package.
14. Scent Air System: $500 to $2,000
15. Initial Supply of Inventory and Operating Supplies: $7,900 to $10,600
- This includes your initial inventory of retail items (such as leashes, collars, toys, dog food, and dog treats) and operating supplies (such as cleaning supplies, uniforms, playroom equipment, scuffle tools, crates, leashes, lip leads, dog bowls, etc.).
- You may only offer, sell, and utilize the inventory items that Dogtopia designates or approves.
16. Grand Opening Marketing: $15,000 to $30,000
- Prior to opening, you must spend a total of at least $15,000 on advertising and other marketing activities to promote your Business, including digital advertising, guerilla marketing, and public relations. Some franchisees may choose to spend more than the minimum required amount.
17. Business Licenses and Permits: $2,000 to $44,000
- You must obtain various licenses and permits, including a general business license, a kennel license, a boarding license, a health department license, and possibly other licenses depending on the laws of your state and municipality. Many of these licenses must be renewed annually.
- You must also obtain special use and/or conditional use permits as well as construction permits.
18. Insurance (3 months’ premium): $1,200 to $3,000
19. Professional Fees: $28,500 to $78,500
- You will hire a variety of professionals relating to your acquisition of the franchise and development of the Business, including attorneys, accountants, architects, engineers, zoning experts, and real estate professionals. Some of these professionals must be hired, while others are optional (but highly recommended).
20. Additional Funds (3 months after opening): $30,000 to $60,000
- This estimates your expenses during the first 3 months of operation, including payroll costs (excluding any wage or salary paid to you), digital marketing fees ($200 per month), post-opening technology fees ($275 to $365 per month), point-of-sale licensing fees ($95 per month), music licensing fees (if applicable), advertising, utilities and other miscellaneous expenses, and required working capital.
21. Total Estimated Initial Investment: $543,193 to $1,489,801
- These figures are estimates based on the experience of Dogtopia franchisees that opened their businesses in 2020.