To whom are additional funds paid to during the first 3 months of operating a Gold Star franchise?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
YOUR ESTIMATED INITIAL INVESTMENT 1
| Type of Expenditure | Amount for Free Standing Building | Amount for Inline Space | Method of Payment | When Due | To Whom Payment Is To Be Made |
|---|---|---|---|---|---|
| Initial Franchise Fee2 | $10,000 to $50,000 | $10,000 to $50,000 | Cashier’s Check | At signing of the Franchise Agreement | Gold Star |
| Real Property & S |
Source: Item 7 — Estimated Initial Investment (FDD pages 18–21)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the additional funds required during the first three months of operation are paid to various entities. The table in Item 7 outlines that these funds, estimated between $15,000 and $30,000 for both free-standing and inline locations, cover payroll and other working capital needs.
The recipients of these funds include Gold Star itself, employees, suppliers, utilities, insurers, professionals, and other miscellaneous vendors. This broad range of recipients highlights the diverse operational expenses a new franchisee can expect in the initial months. These costs are in addition to the grand opening advertising expenses, for which Gold Star requires a minimum spend of $10,000 within the first three months.
It's important to note that these figures are estimates, and actual expenses may vary based on factors such as adherence to Gold Star's policies, advertising efforts, management skills, local economic conditions, and competition. The FDD advises prospective franchisees to carefully review these figures with a business advisor before making a decision, emphasizing the potential for additional, unforeseen expenses during the startup phase.