How does the initial franchise fee for Aerus (Item 5) relate to the estimated initial investment (Item 7)?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
ASSOCIATE PROGRAMS)**
| Type of Expenditure | Estimated Cost – Standard Program | Estimated Cost – Associate Program | Method of Payment | When Due | To Whom Payment is to be made |
|---|---|---|---|---|---|
| Initial Franchise(1) Fee | $3,000 | $1,000 | Lump Sum | At Signing of Franchise Agreement | Us |
| Beyond Addendum(2) | $0 to $100 | $0 to $100 | Lump Sum | As Arranged | Us |
| Fee | |||||
| Leasehold | $0 to $15,000 | $0 to $5,000 | As Arranged | As Arranged | Other Suppliers; |
| Improvements(3) | Contractors | ||||
| Furniture Fixtures | $2,500 to | $2,000 to | As Arranged | As Arranged | Us, our affiliate or |
| and Equipment(4) | $15,000 | $5,000 | Other Suppliers | ||
| Vehicle(5) | $0 to $8,440 | $0 to $8,440 | As Arranged | As Arranged | Suppliers |
| Initial Inventory (supplies, consigned products, spare parts, etc.)(6) | $15,000 to $90,000 | $5,000 to $20,000 | Lump Sum and As Arranged | Upon Placement of Order and As Arranged | Us, our affiliate, or Other Suppliers |
| Pre-Opening Training | $1,000 to | $1,000 to | As Arranged | As Arranged | Airline, Hotel, |
| Expenses(7) | $7,000 | $7,000 | Restaurants, etc. | ||
| Supplies (stationary, | $100 to $600 | $100 to $600 | As Arranged | As Arranged | Suppliers |
| business cards, etc.) | |||||
| (for 3 months) | |||||
| Permits & Licenses | $50 to $200 | $50 to $200 | Lump Sum | As Arranged | Licensing Authorities |
| Insurance deposits and Premiums (for first year)(8) | $1,500 to $2,000 | $1,500 to $2,000 | Lump Sum | As Arranged | Insurers |
| Architect Fees | $0 to $5,000 | $0 to $2,000 | As Arranged | As Arranged | Architect |
| Other Professional | $500 to $1,000 | $500 to $1,000 | As Arranged | As Arranged | Attorneys, |
| Fees | Accountants, etc. | ||||
| Site Lease (for | $500 to $10,000 | $500 to $3,000 | Lump Sum | Monthly | Landlord |
| 3 months)(9) | |||||
| Utility Deposits | $350 to $450 | $350 to $450 | Lump Sum | As Arranged | Utility Companies |
| Advertising and | $0 to $5,000 | $0 to $2,500 | As Arranged | As Arranged | Suppliers, Media, |
| Promotion | etc. | ||||
| Type of Expenditure | Estimated Cost – Standard Program | Estimated Cost – Associate Program | Method of Payment | When Due | To Whom Payment is to be made |
| ------------------------------------ | ----------------------------------------- | ------------------------------------------ | ---------------------- | ------------- | ------------------------------------- |
| Signage | $1,000 to $5,000 | $1,000 to $2,500 | As Incurred | As Incurred | Signage Suppliers |
| Additional Funds | $5,000 to | $3,000 to | As Incurred | As Incurred | Employees, |
| (3 months)(10) | $50,000 | $10,000 | Suppliers | ||
| Goodwill(11) | $0 to $200,000 | $0 to $25,000 | Lump Sum | At Close | Us and Our affiliates |
| TOTALS |
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, the initial franchise fee is a component of the total estimated initial investment. Item 5 details the initial franchise fee, while Item 7 outlines the complete estimated initial investment, which includes the initial franchise fee and other expenses. The initial franchise fee for the Standard Program is $3,000, while for the Associate Program, it is $1,000. These fees are paid at the signing of the Franchise Agreement. Item 7, in the table of estimated initial investment, lists the initial franchise fee as a separate line item.
The estimated initial investment for the Standard Program ranges from $30,500 to $417,790, and for the Associate Program, it ranges from $16,000 to $95,790. Besides the initial franchise fee, the total investment includes costs such as leasehold improvements, furniture, fixtures and equipment, vehicle costs, initial inventory, pre-opening training expenses, supplies, permits and licenses, insurance, architect fees, other professional fees, site lease costs, utility deposits, advertising and promotion, signage, additional funds, and goodwill. The initial franchise fee is non-refundable, except if Aerus chooses not to enter into the Franchise Agreement.
Prospective Aerus franchisees should note that the initial franchise fee is a relatively small portion of the overall initial investment. The initial investment can vary significantly depending on factors such as the program chosen (Standard or Associate), the location, the size of the premises, and other variables. Franchisees should carefully review Item 7 to understand all the potential costs involved in starting an Aerus franchise and how the initial franchise fee fits into the broader financial picture. They should also inquire about potential financing options for the initial franchise fee, as mentioned in Note 1 of Item 7, and review Item 10 for further details on financing.