What is the estimated initial investment for Burros Fries?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
NITIAL INVESTMENT
| Type of Expenditure | Amount Low/High | | Method of Payment | When Due | To Whom Payment is to be Made | |---|---|---|---|---|---| | Initial Franchise Fee | $35,000 | $35,000 | Cash or Acceptable Funds | At signing of the Franchise Agreement. | Franchisor See Item 5 | | Technology including Computers | $5,000 | $10,000 | Cash or Acceptable Funds (for computers, , modem, routers, sound system, camera surveillance system and telephones.) | Before opening | Payable to our approved vendors See Note 1 | | Kitchen Equipment, Furniture and Fixtures | $120,000 | $160,000 | Cash or Acceptable Funds. Actual costs will vary based on the size of your facility. | Before opening | Payable to our approved vendors See Note 2 |
| | | | be Made | |---|---|---|---| | Real Estate (Lease) | $6,500 | $17,000 | As required by Landlord. |
| | | | Cash or Acceptable Funds | | |---|---|---|---|---| | Leasehold | $300,000 | $450,000 | Before | Landlord | *Except as provided below, other than security deposits and utility deposits, all payments and fees described in this Item 7 are non-refundable.
Note 1 A: The Drive Through facility is an optional addition to the restaurant and we believe most franchisees will not include it in their restaurant. The estimated expenditure is between $10,000 low and $20,000 high and is NOT included in the total above.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT YOUR ESTIMATED INITIAL INVESTMENT (FDD pages 16–21)
What This Means (2024 FDD)
According to Burros Fries' 2024 Franchise Disclosure Document, the initial investment includes several key components. These include the initial franchise fee, technology costs, kitchen equipment, furniture and fixtures, and leasehold improvements. The initial franchise fee is a flat $35,000. Technology costs, encompassing computers, modems, routers, sound systems, camera surveillance, and telephones, range from $5,000 to $10,000. Kitchen equipment, furniture, and fixtures are estimated to cost between $120,000 and $160,000, varying with the facility size. Leasehold improvements can range significantly from $300,000 to $450,000. Additionally, real estate lease costs range from $6,500 to $17,000. These costs do not include the optional drive-through facility, which could add an additional $10,000 to $20,000 to the investment.
Several factors can influence the total initial investment for a Burros Fries franchise. The size of the facility plays a significant role, particularly in the costs of kitchen equipment, furniture, fixtures, and leasehold improvements. The location of the business also affects real estate costs, build-out expenses, and the potential need for a drive-through facility. Furthermore, the timing of the opening, the amount of equipment and supplies purchased, the number of employees hired, and the implementation of a marketing plan all contribute to the overall investment. The FDD notes that the estimates are based on an owner-operated business or incorporating operations within an existing business, and do not include salaries or benefits for full-time employees.
Prospective franchisees should be aware of several important considerations. The estimates provided are based on the franchisor's principals' experience, but actual costs may vary. Competitive conditions can also affect these costs. The initial investment does not include royalties and system advertising fees, which begin immediately upon opening. The FDD recommends reviewing these figures with a business advisor and developing individual expense and cash flow projections. Additionally, the FDD states that Burros Fries does not offer direct or indirect financing for the initial investment, and franchisees should have sufficient capital to cover living expenses for at least six months of operation.
It is also important to note that most payments and fees described in Item 7 are non-refundable, with the exception of security deposits and utility deposits. Franchisees must purchase approved products, supplies, and uniforms from Burros Fries, its affiliates, or approved vendors, and these purchases may not be refundable depending on the terms of the agreements. Insurance premiums may also be non-refundable based on the terms of the insurance policies. Therefore, careful consideration and due diligence are essential before making any financial commitments.