What is the estimated low amount for the total initial investment for a Deka Lash franchise?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
ESTMENT FRANCHISE AGREEMENT
| Fee | Estimated | Estimated | Method of | When Due | To Whom Payment | |
|---|---|---|---|---|---|---|
| Amount Low | Amount High | Payment | is to be Made | |||
| Initial Franchise Fee (Note 1) | $59,900 | $59,900 | Wire / ACH | Upon entering into franchise agreement | Us | |
| Operations Onboarding & First Studio | $5,450 | $5,450 | Wire / ACH | Upon entering into | Us | |
| Opening Support Fee (Note 2) | franchise agreement | |||||
| Initial Staff Training & Certification | $3,750 | $3,750 | Wire / ACH | Upon entering into | Us | |
| (Note 3) | franchise agreement | |||||
| New Franchisee Training Travel, | $300 | $3,000 | As Arranged | Before Opening | Third-party vendors | |
| Meals & Lodging (Note 4) | ||||||
| Design / Architectural Plans (Note 5) | $1,000 | $5,000 | As Arranged | Before Opening | Third-party vendors | |
| Leasehold Improvements & Project | $75,000 | $150,000 | As Arranged | Before Opening | Third-party vendors | |
| Management (Note 6) | ||||||
| Rent & Security Deposits (Note 7) | $12,000 | $25,000 | As Arranged | Monthly | Landlord & Third- party suppliers | |
| Signage (Note 8) | $5,000 | $10,000 | As Arranged | Before Opening | Third-party vendors | |
| Furniture, Fixtures and Equipment | $60,000 | $86,000 | As Arranged | Before Opening | Third-party vendors | |
| (Note 9) | ||||||
| Flooring (Note 10) | $5,000 | $8,000 | As Arranged | Before Opening | Third-party vendors | |
| Computers and Hardware (Note 11) | $2,000 | $5,000 | As Arranged | Before Opening | Third-party vendors | |
| Start-up Supplies / Inventory (Note 12) | $13,500 | $13,500 | As Arranged | Before Opening | Us & Third-party vendors | |
| Grand Opening / Marketing (Note 13) | $9,000 | $12,000 | As Arranged | Before Opening | Us & Third-party vendors | |
| Insurance & Permits (Note 14) | $3,250 | $7,500 | As Arranged | As incurred | Third-party vendors | |
| Professional Fees (Note 15) | $1,250 | $3,750 | As Arranged | As incurred | Third-party vendors | |
| Utilities (Note 16) | $500 | $1,500 | As Arranged | As incurred | Third-party utilities | |
| Payroll (Note 17) | $23,000 | $35,000 | As Arranged | Bi-Weekly or Semi- Monthly | Employees | |
| Additional Funds (Note 18) | $6,000 | $15,000 | As Arranged | As incurred | Us & Third-party Vendors | |
| TOTAL (Note 19) | $285,900 | $449,350 | #### Table 1 Notes |
None of the fees paid to us in this table are refundable. Whether fees paid to third parties are refundable would depend upon the policies of those third parties.
Note 1 – Initial Franchise Fee. We base the initial franchise fee on your acquisition of one territory. We offer a 25% discount for military veterans with proper honorable discharge documentation. If you are acquiring an open and operating Franchised Business, the initial franchise fee is $19,900.
If you have been a franchisee for at least 24 months, we may offer financing of up to 50% of the initial franchise fee of $38,000 for an additional expansion territory, at 10% per annum interest, repaid monthly over 60 months.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 23–27)
What This Means (2024 FDD)
According to Deka Lash's 2024 Franchise Disclosure Document, the estimated low amount for the total initial investment for a single franchise is $285,900. This figure encompasses various startup costs, including the initial franchise fee of $59,900, operations onboarding and first studio opening support fee of $5,450, initial staff training and certification of $3,750, and expenses for franchisee training travel, meals, and lodging, estimated between $300 and $3,000.
The initial investment also accounts for design and architectural plans, with a low estimate of $1,000, leasehold improvements and project management at $75,000, and rent and security deposits totaling $12,000. Further costs include signage ($5,000), furniture, fixtures, and equipment ($60,000), flooring ($5,000), computers and hardware ($2,000), and start-up supplies and inventory ($13,500).
Additional expenses factored into the total are grand opening and marketing ($9,000), insurance and permits ($3,250), professional fees ($1,250), utilities ($500), payroll ($23,000), and additional funds ($6,000). It is important to note that this total does not include royalties, brand development fees, depreciation, interest expenses, or taxes. These figures are estimates for the first three months of operation, and Deka Lash advises prospective franchisees to carefully review these figures with a business advisor.
For franchisees considering an Area Development Agreement, the estimated low total initial investment is $323,900. This includes an Area Development Fee of $97,900 and an initial investment for the first franchised business of $226,000. This initial investment allows the franchisee the right to open and operate two to ten franchised businesses within a development area, as well as the cost of opening the first franchised business.