What is the estimated range for the first Desi District franchise initial investment?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
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| Type of expenditure | Amount | Method of payment | When due | To whom payment is to be made |
|---|---|---|---|---|
| Office Expenses (see | $500 - $1,000 | Check, debit, and/or credit | As incurred | Vendors |
| Note 10) | ||||
| Inventory (see Note 11) | $20,000 - $40,000 | Check, debit, and/or credit | Upon ordering | Our Affiliate, Vendors |
| Licenses and Permits (see Note 12) | $1,000 - $2,000 | Check | Upon application | Government |
| Dues and Subscriptions (see Note 13) | $200 - $500 | Check, debit, and/or credit | As incurred | Vendors, trade organizations |
| Professional Fees | $1,500 - $4,000 | Check, debit, and/or credit | As incurred or when billed | Professional service firms |
| (lawyer, accountant, | ||||
| etc.) (see Note 14) | ||||
| Travel, lodging and | $3,000 - $6,000 | Cash, debit or credit | As incurred | Airlines, hotels, and restaurants |
| meals for initial training | ||||
| (see Note 15) | ||||
| Additional funds (for first 3 months) (see Note 16) | $75,000 - $100,000 | Varies | Varies | Employees, suppliers, utilities |
| Total | $669,200 - $1,020,500 | This is the total estimated initial investment to open and commence operating your initial location for the first three months (as described more fully in Chart A of this Item 7). See Note 3. |
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 20–26)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, the estimated initial investment to open a single franchise location ranges from $669,200 to $1,020,500. This investment covers expenses incurred before the location opens and during the initial three months of operation. These costs include the initial franchise fee, rent and lease security deposit, leasehold improvements, market introduction program, furniture, fixtures, equipment, computer systems, insurance, signage, office expenses, inventory, licenses and permits, dues and subscriptions, professional fees, travel, lodging and meals for initial training, and additional funds.
The total cost depends on the franchise model chosen. The Eatery model, which is a smaller restaurant-only business, generally represents the lower end of the investment range. The Eatery and Market model, which combines a restaurant and grocery business, requires a larger space and, consequently, a higher investment. For example, inventory costs for the Eatery model are estimated between $5,000 and $10,000 through TAR Distributors, Inc., while the Eatery and Market model estimates inventory costs between $20,000 and $80,000 through the same affiliate.
Prospective franchisees should note that these are estimates, and actual costs may vary based on location, market conditions, and the franchisee's specific circumstances. The FDD advises that costs for leasehold improvements can vary greatly depending on location and construction costs in the market. The document also notes that these estimates assume the franchisee will rent the location and negotiate a 'free rent' period to offset build-out time. Purchasing real estate instead of renting would significantly alter the initial investment. Franchisees should carefully review all components of the initial investment with Desi District and their own advisors to develop a detailed budget.