What is the estimated range for leasehold improvements in the initial investment for a Big Apple Bagels franchise?
Big_Apple_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
VESTMENT**
BAB Production Store Franchise
| Type of Expenditure | Estimated Amount or Estimated High-Low Range | Method of Payment | When Due | To Whom Paid | |
|---|---|---|---|---|---|
| Initial Franchise Fee (1,2) | $25,000 | Lump Sum less Franchise Fee Deposit paid | When you sign the Franchise Agreement | BAB | |
| Store Opening Marketing Fee(3) | $7,500 | Lump Sum | Upon signing Franchise Agreement | BAB (BAGELS Marketing Fund) | |
| Professional Fees(4) | $5,000 - $10,000 | As Agreed | As incurred | Professionals | |
| First Month's Rent and Security | $4,000 - $9,000 | As agreed in | As agreed in lease | Lessor | |
| Deposit(5) | lease | ||||
| Insurance(6) | $5,000-$9,000 | Lump Sum | As incurred | Insurance Company | |
| Leasehold Improvements(7) | $170,000 - $292,000 | As agreed | As incurred | Suppliers | |
| Exterior and Interior Signage | $6,000 - $12,000 | As agreed | As incurred | Designated | |
| and Display (8) | Supplier | ||||
| Furniture, Fixtures, Equipment | $226,000 - $270,000 | As agreed | As incurred | Approved | |
| (9) | Suppliers | ||||
| Training(10) | $2,000 - $5,000 | As incurred | Before Opening | Hotels; Transportation Lines; Car; Restaurants | |
| Prepaid Expenses, Deposits(11) | $500 - $1,500 | Lump Sum | As incurred | Third Parties | |
| Opening Inventory, Supplies(12) | $15,000-$23,000 | As agreed | As incurred | Approved Suppliers | |
| Additional Funds - 3 months(13) | $12,000 - $18,000 | Varies | As incurred | Third Parties | |
| TOTALS | $478,000-$685,000 | Except for the Franchise Fee Deposit, the payments in the table above are non-refundable. The refundability of the Franchise Fee Deposit under the Preliminary Agreement is as follows: If you submit at least 1 site to BAB within the 60 days, but the site is not approved, BAB will refund all but $3,000 of the deposit. If you fail to submit even 1 site to BAB within the 60 days, you will not be entitled to a refund of any of the deposit. If you locate a site and sign a Franchise Agreement, the $10,000 deposit will be applied toward the initial franchise fee. If you locate a site and it is approved by BAB within the 60 days but you fail to sign a Franchise Agreement within 14 days of the approval, BAB may terminate the Preliminary Agreement and you will not be entitled to any refund of the $10,000 deposit. |
Neither BAB nor any affiliate finances part of the initial investment.
NOTES:
(1, 2) Initial Franchise Fee. The initial franchise fee is $25,000. If you enter into a Preliminary Agreement, you must pay BAB a deposit in the amount of $10,000. If you ultimately sign a Franchise Agreement, you must pay BAB the balance of the applicable initial franchise fee at the time you sign the Franchise Agreement. You must sign the Franchise Agreement within 14 days after we approve your site, or we may terminate the Preliminary Agreement. See Item 5 concerning the refund of your deposit. The $25,000 is for your first Franchise Agreement; if you sign more than 1 Franchise Agreement, the franchise fee is $20,000 for your 2nd and subsequent BAGELS Production Stores.
If you are a Developer, for each subsequent store developed under an Area Development Agreement, the franchise fee is $15,000 for your 2nd and subsequent BAGELS Production Stores.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 26–34)
What This Means (2025 FDD)
According to Big Apple Bagels's 2025 Franchise Disclosure Document, the estimated cost for leasehold improvements ranges from $170,000 to $292,000 for a BAGELS Production Store. For a BAGELS Satellite Store, the estimated cost for leasehold improvements ranges from $130,000 to $217,000. These costs are paid to suppliers as agreed upon and incurred.
Leasehold improvements include expenses related to flooring, ceiling, lighting, plumbing (to comply with the Americans with Disabilities Act), electrical upgrades, telephone lines, internet connections for the store and POS system, and cabinetry. The actual cost can vary significantly based on the size, condition, and location of the premises, differences in supplier pricing, and the terms negotiated with the lessor.
Prospective franchisees should carefully consider these factors and obtain detailed quotes from multiple suppliers to develop a realistic budget for leasehold improvements. Negotiating favorable lease terms with the lessor can also help manage these costs. It is advisable to consult with an experienced architect and contractor to assess the condition of the premises and estimate the necessary improvements accurately. These costs do not include sales taxes, which vary from state to state or shipping costs. You should factor in sales taxes and shipping costs to these estimates.