What ongoing expenses will a Bananas Smoothies Frozen Yogurt franchisee need to support?
Bananas_Smoothies_Frozen_Yogurt Franchise · 2025 FDDAnswer from 2025 FDD Document
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- 13 You will need to support ongoing expenses, such as payroll and utilities to the extent that these costs are not covered by sales revenue. New businesses often generate negative cash flow.
We estimate that the amount stated will be sufficient to cover ongoing expenses for the initial phase of the business which we calculate to be three months. This is only an estimate, however, and there is no assurance that additional working capital will not be necessary during this start-up phase or after. We relied on our past experience with franchised and company-owned restaurants when preparing the figures.
- 14 You must purchase or lease a computer and an electronic Point of Sale system, and we do specify the brand or model. You may not use any hardware and/or software in the operation of the restaurant without the Franchisor's prior approval, which approval will not be unreasonably withheld. (See Item 11).
- 15 Our current estimates of your initial investment for the franchised businesses offered are set forth above. The various schedules presented illustrate your initial investment if you acquire the franchised businesses separately or in combination. The actual amounts you incur may be higher, however, if particular circumstances apply to the location of your Franchised Business or to your region of the country. We calculate the initial phase of business to be three months following the completion of construction.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 19–31)
What This Means (2025 FDD)
According to the 2025 Bananas Smoothies Frozen Yogurt FDD, franchisees will need to cover ongoing expenses such as payroll and utilities. These costs must be supported to the extent that sales revenue does not cover them. The FDD notes that new businesses often experience negative cash flow, making it crucial to have sufficient capital to manage these initial deficits.
Bananas Smoothies Frozen Yogurt estimates that the initial phase of the business, which they calculate to be three months, will be sufficiently covered by the stated amount. However, this is only an estimate, and there is no guarantee that additional working capital will not be necessary during the start-up phase or afterward. The franchisor relied on their past experience with both franchised and company-owned restaurants when preparing these figures.
In addition to payroll and utilities, franchisees should be prepared for other potential ongoing expenses. These may include insurance, which requires obtaining quotes from a carrier, and the purchase of opening inventory consisting of approved products and a trial inventory for training. Franchisees will also need to cover utility deposits for services like gas, electric, water, sewer, and telephone. Furthermore, franchisees must account for local, municipal, county, and state licenses and permits required to operate the Bananas Smoothies Frozen Yogurt business.