Are security deposits required for Black Bear Diner franchises?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Expenditure(1) | Amount | Method of Payment | When Due | To Whom Paid |
|---|---|---|---|---|
| Franchise Fee(2) | $24,000 to $55,000 | Lump Sum | At Signing of Franchise Agreement | Us |
| Development Services Fee(3) | $0 to $100,000 | Lump Sum | As Signing of Development Services Agreement | Us |
| First Month’s | $9,000 to $20,000 | As Arranged | As Arranged | Landlord |
| Rent(4) | ||||
| Security | $7,500 to $23,000 | As Arranged | As Arranged | Landlord, |
| Deposits(5) | Utilities |
EXPLANATORY NOTES:
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- Security Deposits. Security deposits generally are required by the utility companies, the landlord and any equipment lessors you may elect to use. Amounts will vary depending on the requirements under the various leases, utilities' policies and your credit rating. Included is one month's rent for a security deposit in connection with your lease and utilities.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT YOUR ESTIMATED INITIAL INVESTMENT (FRANCHISE AGREEMENT) (FDD pages 18–22)
What This Means (2025 FDD)
According to Black Bear Diner's 2025 Franchise Disclosure Document, security deposits are required. The estimated initial investment includes a line item for security deposits, which range from $7,500 to $23,000. These deposits are paid to the landlord and utility companies.
The FDD notes that security deposits are generally required by utility companies, the landlord, and any equipment lessors a franchisee may use. The amounts will vary depending on the requirements under the various leases, utilities' policies, and the franchisee's credit rating. The estimate includes one month's rent for a security deposit in connection with the lease and utilities.
Prospective Black Bear Diner franchisees should budget for these security deposits as part of their initial investment. The actual amount required will depend on factors such as the location of the restaurant, the franchisee's creditworthiness, and the policies of the local utility companies and landlord. It is important to factor in these potential costs when evaluating the financial feasibility of opening a Black Bear Diner franchise.