76 Fence: $1.42M Sales for Predecessor Business vs. $163K-$315K Franchise Cost

In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:

Section I – Estimated initial investment (franchise costs) for a 76 Fence franchise, based on Item 7 of the company’s 2024 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a 76 Fence franchise, based on Items 5 and 6 of the company’s 2024 FDD

Section III – Number of franchised and company-owned 76 Fence outlets at the start of the year and the end of the year for 2021, 2022, and 2023, based on Item 20 of the company’s 2024 FDD

Section IV – News updates on the 76 Fence franchise opportunity

Section V – Presentation and analysis of 76 Fence’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2024 FDD, including information on the:

• January 1, 2023 to November 20, 2023 gross sales, cost of goods sold, certain expenses, franchise expenses, and net income for the 76 Fence outlet owned by the franchisor’s predecessor (“Predecessor Outlet”)

• 2021 and 2022 gross sales for the Predecessor Outlet

Section VI – Key ratios, comparables, computations, and analyses for the 76 Fence franchise opportunity (exclusive content for Platinum subscribers)

Section I – 76 Fence Franchise Costs

• 76 Fence franchise costs, based on Item 7 of the company’s 2024 FDD:

• Initial Franchise Fee:  $60,000 to $185,000
• Rent, Security Deposit, and Utilities:  $0 to $8,000
• Initial Marketing:  $20,000
• Furniture, Fixtures, and Equipment:  $2,500 to $7,000
• Computer Systems:  $1,500 to $2,500
• Software and Technology Fees:  $3,600 to $3,700
• Insurance, Certifications, and Licenses:  $4,000 to $7,000
• Vehicle:  $4,000 to $10,000
• Signage and Branding:  $3,500 to $5,000
• Office Expenses:  $1,000 to $2,000
• Professional Fees:  $1,000 to $2,500
• Training Expenses:  $2,000 to $3,000
• Additional Funds:  $60,000
• Total Estimated 76 Fence Franchise Costs:  $163,100 to $315,700

Section II – 76 Fence’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• 76 Fence’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2024 FDD:

• Initial Franchise Fee:  $60,000 to $185,000
• Royalty:  the greater of 8% of Gross Sales or a Minimum Royalty of $250 per week
• Local Advertising Fees:  $3,500 per month for your first Territory plus $2,000 for your second Territory and $1,500 for each additional Territory
• Brand Development Fund:  0.5% of weekly Gross Sales

Section III – Number of Franchised and Company-Owned 76 Fence Outlets

Franchised

2021

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2022

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2023

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

Company-Owned

2021

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  1
• Net Change:  +1

2022

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

2023

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

Section IV – News Updates on the 76 Fence Franchise

• 76 Fence Did Not Rank on Entrepreneur’s 2024 Franchise 500 List

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the 76 Fence Franchise (Item 19, 2024 FDD)

• Part 1 of this Item 19 contains the historical financial performance information of the outlet owned by the franchisor’s predecessor, CMS ILLINOIS, (“Predecessor Outlet”) during the period between January 1, 2023 and November 20, 2023 (the “Part 1 Measurement Period”).

• Part 2 of this Item 19 contains the historical financial performance information of the Predecessor Outlet during the periods between January 1, 2021 and December 31, 2021 and also between January 1, 2022 and December 31, 2022 (the “Part 2 Measurement Period”).

• The Predecessor Outlet previously operated a fencing repair and installation business in the Chicago, Illinois area under the name “CMS Fencing” but converted this business to an affiliate-owned 76 Fence business in July 2023. Currently, the Predecessor Outlet operates in substantially the same manner as a Franchised Business would.

• The Predecessor Outlet earned these amounts. Your individual results may differ. There is no assurance you will earn as much.

Part 1 – Gross Sales and Certain Expenses Incurred by the Predecessor Outlet (January 1, 2023 to November 20, 2023)

• The chart below shows the Gross Sales earned and certain expenses incurred by the Predecessor Outlet during the Part 1 Measurement Period.

Gross Sales

• Residential Sales:  $1,124,995 (78.9%)
• Commercial Sales:  $301,457 (21.1%)
• Total Gross Sales:  $1,426,452 (100.0%)

Cost of Goods Sold

• Materials:  $325,330 (22.8%)
• Third-Party Labor:  $481,096 (33.7%)

Certain Expenses

• Payroll:  $48,482 (3.4%)
• Call Center:  $9,638 (0.68%)
• Bank Charges and Fees:  $672 (0.05%)
• Vehicle:  $12,451 (0.87%)
• Insurance:  $3,951 (0.28%)
• Interest:  $1,373 (0.10%)
• Legal and Professional Fees:  $5,606 (0.39%)
• Meals and Entertainment:  $677 (0.05%)
• Office Supplies and Software:  $24,432 (1.71%)
• QuickBooks Fees:  $7,579 (0.53%)

Franchise Expenses

• Advertising Expense:  $60,500 (4.24%)
• Brand Development Fund Contribution:  $7,132 (0.50%)
• Royalty:  $114,116 (8.00%)
• Accounting Vendor Fees:  $6,000 (0.42%)

Net Income:  $317,417 (22.2%)

Part 2 – 2021 and 2022 Gross Sales of the Predecessor Outlet

• The chart below shows the Gross Sales earned by the Predecessor Outlet during the Part 2 Measurement Period.

• 2021 Gross Sales:  $702,408.54
• 2022 Gross Sales:  $1,118,446.41

• “Gross Sales” means the entire amount of all of the revenues from the ownership or operation of the Predecessor Outlet, whether the revenues are evidenced by cash, credit, checks, services, property, or other means of exchange.

• “Cost of Goods Sold” means the entire amount spent by the Predecessor Outlet for materials and third-party labor used in the operation of the Predecessor Outlet during the Measurement Period.

• “Certain Expenses” means the amounts spent by the Predecessor Outlet for certain expenses used in the operation of the Predecessor Outlet during the Measurement Period. “Certain Expenses” does not include rent, your local advertising requirement, Accounting Software Fees, Scheduling and CRM Software Fees, Technology Fees, amounts expended to attend the initial training program, and other expenses necessary to open and begin operating a Franchised Business.

• “Franchise Expenses” represents the amount that the Predecessor Outlet would have paid to 76 Fence in connection with Royalty and Brand Development Fund Contributions if it was operating as a franchisee.

• This information was provided to 76 Fence by the Predecessor Outlet. 76 Fence has not audited or independently verified the data submitted by the Predecessor Outlet and no assurance can be offered that the data does not contain inaccuracies that an audit might disclose.

• Your sales and expenses will vary depending upon the location of your business. The Predecessor Outlet is located in the Chicago, Illinois metropolitan area. Rent and other operating costs may vary depending upon your location.

• This analysis does not contain complete information concerning your potential operating costs. Operating costs may vary substantially from business to business.

Section VI – 76 Fence Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️

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