What is the expectation of Endless Summer Sweets regarding renting vs. purchasing real estate?

According to Endless Summer Sweets' 2024 Franchise Disclosure Document, the company expects franchisees will rent their location. The FDD indicates that if a franchisee chooses to purchase real estate instead of renting, their costs will be significantly different.

The document provides estimates for rent payments, assuming one month's rent plus a security deposit before opening. The low estimate for rent is approximately $2,917 per month, while the high estimate is approximately $5,625 for two months. The typical space size is expected to be in the range of 1,000 to 1,500 square feet.

Endless Summer Sweets suggests that franchisees consult with a commercial real estate agent in their area to understand local rental amounts, lease terms, space requirements, tenant improvements, security deposits, and advance rental requirements, as location is a major factor in rental costs. Franchisees may also want to negotiate a "free rent" period to cover the time it takes to build out their business. These estimates may not cover advance rental deposits, insurance, and similar expenses.

While Endless Summer Sweets anticipates franchisees will rent, the FDD acknowledges the possibility of purchasing real estate. However, it does not provide specific cost estimates or guidance for purchasing property. A prospective franchisee should discuss the implications of purchasing real estate with Endless Summer Sweets directly to understand any specific requirements or recommendations.