How does the business experience of Crave's management (Item 2) relate to the initial investment costs (Item 7)?

According to Crave's 2025 Franchise Disclosure Document, the estimated initial investment figures presented in Item 7 are based on the principals' experience in opening and operating restaurants and food truck businesses since 2007. This indicates that Crave has used its management's prior experience to inform the estimates for costs such as the initial franchise fee, lease and utility deposits, design and architect fees, leasehold improvements, signage, equipment, point-of-sale systems, licenses and permits, insurance, inventory, training, grand opening marketing, and the cost of a food truck with equipment. These costs vary depending on the type of franchise (Restaurant, Food Truck, or Express Restaurant) and specific location.

For a prospective franchisee, this means that the initial investment estimates are not arbitrary but are grounded in the actual experience of Crave's leadership. For example, the cost for a Truck with Equipment is estimated between $225,000 and $285,000, while Grand Opening Marketing for a Restaurant or Food Truck is $5,000. The FDD specifies that these figures are based on the brand's operational history since 2007. This experience likely allows Crave to provide a more realistic range of expenses that a new franchisee can expect to encounter.

However, the FDD also acknowledges that certain costs are subject to factors that Crave cannot estimate or control, such as inflation, increased labor costs, or increased materials costs. Additionally, the estimates do not include any sales revenue that a new business might generate, and new businesses often experience negative cash flow initially. Therefore, while the management's experience provides a foundation for the estimates, franchisees should still conduct their own due diligence and consider these external factors and potential for negative cash flow when planning their initial investment and operating budget.