Does Desi District or any affiliate finance any part of the initial investment?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
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- The Franchise Fee is due and payable at the time of executing the Franchise Agreement. Your lease security deposit and utility deposits will usually be refundable unless you owe money to the landlord or utility provider. None of the other expenditures in this table will be refundable. Neither we nor any affiliate finances any part of your initial investment. Each of these investment ranges varies depending on the type of franchise model you invest in. The Eatery model is a smaller footprint and operates as only a restaurant business. The Eatery and Market Model is a combination of restaurant and grocery business and requires a larger footprint and as a result more of an investment to open. In this Item 7, the lower end of the investment range generally accounts for the Eatery model and the higher end of the range of investment accounts for the Eatery and Market model.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 20–26)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, neither Desi District nor any affiliate provides financing for any part of a franchisee's initial investment. This means that prospective franchisees must secure funding for the entire initial investment through their own means, such as personal savings, loans, or other external financing options.
This lack of direct financing from Desi District is a fairly common practice in the franchise industry. Franchisees should be prepared to cover expenses such as the initial franchise fee, rent and security deposits, leasehold improvements, market introduction programs, furniture, fixtures, equipment, computer systems, insurance, signage, office expenses, inventory, licenses and permits, dues and subscriptions, professional fees, travel and lodging for initial training, and additional funds for the first three months of operation. These costs can range from $669,200 to $1,020,500 for a single location, depending on the franchise model (Eatery only or Eatery & Market).
For franchisees considering a Multi-Unit Development Agreement (MUDA), the initial investment ranges from $692,700 to $2,628,000, depending on the number of locations (2 to 5). Franchisees entering into a MUDA will pay initial franchise fees of $30,000 for each additional franchise beyond the first. Given the significant capital outlay required, potential franchisees should carefully evaluate their financial resources and explore all available funding options.
While Desi District does not offer direct financing, franchisees may purchase inventory from TAR Distributors, Inc., an affiliate of Desi District. For the Eatery model, inventory purchases from TAR Distributors, Inc. range from $5,000 to $10,000, while the Eatery and Market model requires $20,000 to $80,000 in purchases from TAR Distributors, Inc. However, franchisees are still responsible for securing the funds to make these purchases.