What is the high estimate for initial inventory for a Cream franchise?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Expenditure | Amount | Method of Payment 1 | When Due | To Whom Payment is Made | |
|---|---|---|---|---|---|
| Low | |||||
| Initial Franchise Fee | $40,000 | $40,000 | Lump sum | Upon signing Franchise Agreement | Us |
| Real Estate (3 Months’ | $18,000 | $60,000 | As arranged | As arranged | Landlord |
| Rent) 2 | |||||
| Lease and Utility Security Deposits 3 | $6,000 | $20,000 | As arranged | As arranged | Unaffiliated third parties (e.g., utility companies, landlord) |
| Architect, Permits, Engineers, and Licenses 4 | $40,000 | $60,000 | As arranged | As arranged | Unaffiliated third parties (e.g., architect, engineer, designer) |
| Leasehold | $375,000 | $700,000 | As arranged | As arranged | Unaffiliated third |
| Improvements 5 | parties | ||||
| Furniture, Fixtures, and | $70,000 | $134,000 | As arranged | As arranged | Approved third- |
| Equipment 6 | party suppliers | ||||
| Décor Package 7 | $2,000 | $10,000 | As arranged | As arranged | Approved third- party suppliers |
| Computer System and | $2,000 | $4,000 | As arranged | As arranged | Approved third- |
| Technology 8 | party suppliers | ||||
| Tools and Supplies 9 | $12,000 | $16,000 | As arranged | As arranged | Approved third- party suppliers |
| Signage 10 | $10,000 | $30,000 | As arranged | As arranged | Approved third- party suppliers |
| Business Licenses and | $500 | $1,000 | As required | As required | Government |
| Permits 11 | agencies | ||||
| Type of Expenditure | Amount Low | Method of Payment 1 | When Due | To Whom Payment is Made | |
| Professional Fees 12 | $10,000 | $17,000 | As arranged | As arranged | Unaffiliated third parties (e.g., accountant, attorney) |
| Initial Inventory 13 | $20,000 | $26,000 | As arranged | As arranged | Us and approved third-party suppliers |
| Ongoing Inventory (3 months) 13 | $52,000 | $87,000 | As arranged | As arranged | Us and approved third-party suppliers |
| Insurance (3 months) 14 | $500 | $750 | As arranged | As incurred | Unaffiliated third parties (e.g., insurance companies) |
| Initial Training Program Expenses 15 | $3,000 | $5,000 | As arranged | As incurred | Unaffiliated third parties (e.g., airlines, hotels, restaurants) |
| Grand Opening | $20,000 | $25,000 | As arranged | As arranged | Unaffiliated third |
| Advertising 16 | parties | ||||
| Additional Funds – First 3 Months of Operation 17 | $15,000 | $30,000 | As incurred | As incurred | Unaffiliated and approved third- party suppliers (e.g., employees) |
| TOTAL ESTIMATED | $696,000 | $1,265,750 | |||
| INITIAL | |||||
| INVESTMENT 18 |
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 17–22)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, the estimated initial investment for inventory ranges from $20,000 to $26,000. This includes inventory purchased prior to opening the shop, such as items from Parent (estimated at $16,000 to $21,000) and other inventory from approved third-party suppliers.
This initial inventory includes items like waffle mix, toppings, beverages, non-branded merchandise, paper products, and branded packaging materials. It's important to note that this is just an initial estimate, and the actual amount may vary based on the specific needs and demands of the Cream location.
In addition to the initial inventory, the FDD also mentions ongoing inventory costs for the first three months of operation, estimated at $52,000 to $87,000. This highlights the continuous investment required to maintain adequate stock levels for a Cream franchise. Prospective franchisees should carefully consider these inventory costs when planning their initial investment and ongoing operational expenses.