How does the Exit requirement to purchase from approved suppliers (Item 8) affect the estimated initial investment (Item 7)?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
We estimate that the required purchases described above are 3.0% to 12.0% of the cost to establish and operate the EXIT Franchise (this includes the exterior sign(s), office supplies, yard signs and MEMO fees).
You must purchase all stationery, merchandising material and/or anything else that is utilized by you that contains EXIT's logo and/or Marks from EXIT's Approved Suppliers or Suppliers that sign a Confidentiality and License Agreement with EXIT. EXIT, through its Affiliate, Ah$um America, Inc., maintains a list of Approved Suppliers. If you wish to have a supplier designated as "Approved," you may submit information about the supplier and its relevant products or services to Ah$um America, Inc. for review. Ah$um America, Inc. will not unreasonably withhold its approval of any supplier that meets the quality standards set forth in the EXIT Training Manual and agrees to sign Ah$um America, Inc.'s then current Terms and Conditions document for Approved Suppliers. Ah$um America, Inc. will notify you of its decision within 60 days of your submission. Ah$um America, Inc. reserves the right to re-inspect the products or services of any Approved Supplier and revoke its approval if the service or product fails to meet the quality standards set forth in the EXIT Training Manual. Ah$um America, Inc. will send written notice of any revocation to the Approved Supplier. Ah$um America does not impose a fee or cost for Supplier approval.
EXIT is the only approved supplier for certain computer software for the Franchise report system known as MEMO. You must purchase a compatible computer for the Franchise MEMO system. The computer requirements are described in ITEM 11. The MEMO system has been developed and will be licensed by EXIT to you. There is no initial cost for the system. You must pay a monthly license fee of $250.00. If you own more than 1 EXIT Franchise, and those are operated by the same legal entity and use the same trade name, the monthly license fee for the second and subsequent Franchise Agreements shall be reduced to 25% of the monthly license fee charged at the time the subsequent Franchise Agreement(s) is signed.
| Type of Expenditure | Amount | Method of |
|---|---|---|
| Payment | ||
| Initial Franchise Fee1 | $7,500 - $25,000 | Lump Sum |
| Training Expenses | $2,500-$5,000 | As Incurred |
| Real Property – Leased for | $12,000- | As Billed |
| 12 Months2 | $50,000 | |
| Insurance3 | $2,000-$10,000 | As Billed |
| Equipment, Fixtures, Other Fixed Assets, Construction, Remodeling Leasehold Improvements & Decorating Costs4 | $10,000- $30,000 | As Billed |
| Security Deposits, Utility Deposits, Business Licenses & Other Prepaid Expenses5 | $1,500-$5,000 (if applicable) | As Billed |
| Exterior Office Sign | $500-$5,000 | As Billed |
| Automobile Lease6 | $4,800-$9,000 | As Billed |
| Additional Funds (6 months)7 | $20,000- $70,000 | As Needed |
| Total | $60,800- $209,000 |
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the requirement to purchase from approved suppliers impacts the initial investment. Exit estimates that required purchases from approved suppliers account for 3.0% to 12.0% of the total cost to establish and operate an Exit franchise. This includes expenses for the exterior sign(s), office supplies, yard signs, and MEMO fees.
Specifically, franchisees must purchase stationery, merchandising material, and anything with Exit's logo from approved suppliers or those with a Confidentiality and License Agreement with Exit. Exit is the only approved supplier for certain computer software for the Franchise report system known as MEMO. There is no initial cost for the MEMO system, but franchisees must pay a monthly license fee of $250. If a franchisee owns more than one Exit franchise operated by the same legal entity and trade name, the monthly license fee for the second and subsequent franchise agreements is reduced to 25% of the monthly fee charged when the subsequent agreements are signed.
Item 7 provides a table outlining the estimated initial investment, which ranges from $60,800 to $209,000. This total includes various expenditures such as the initial franchise fee ($7,500 - $25,000), training expenses ($2,500 - $5,000), real property lease costs for 12 months ($12,000 - $50,000), insurance ($2,000 - $10,000), equipment, fixtures, and other fixed assets ($10,000 - $30,000), security and utility deposits ($1,500 - $5,000), exterior office sign ($500 - $5,000), automobile lease ($4,800 - $9,000), and additional funds for the first 6 months ($20,000 - $70,000). The costs associated with purchasing from approved suppliers for items like the exterior office sign and office supplies are factored into these estimated ranges.