What is included in the 'Additional funds 3 months' estimate for The Standardx, and what costs are specifically excluded?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
onal training or consulting services.
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- Additional funds 3 months. This item estimates your initial start-up expenses (other than the items identified separately in the table). These expenses include payroll costs for the Hotel's personnel but not any management fees or similar draw. These figures are estimates, and we cannot guarantee that you will not have additional expenses starting the business. Your costs depend on how closely you follow our methods and procedures; your management skill,
experience, and business acumen; local economic conditions; the local market for the Hotel's services; the prevailing wage rate; competition; and the sales level reached during the initial period.
- Total estimated initial investment (excluding real estate costs). The estimated amounts presented in the table above are to construct a new, full-size Brand Hotel with 125 to 300 guest rooms, according to the Design and Construction Standards and the Hotel System.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 36–40)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, the 'Additional funds 3 months' estimate covers initial start-up expenses not already accounted for in other categories. This estimate, which ranges from $360,000 to $675,000, specifically includes payroll costs for the hotel's personnel. However, it explicitly excludes any management fees or similar draws. These additional funds are intended to cover costs incurred during the initial three months of operation.
The FDD indicates that these figures are estimates, and The Standardx cannot guarantee that franchisees will not incur additional expenses. The actual costs can vary significantly based on several factors, including the franchisee's adherence to The Standardx's methods and procedures, their management skills, experience, business acumen, local economic conditions, the local market for the hotel's services, prevailing wage rates, competition, and the sales level achieved during the initial period.
Prospective franchisees should carefully review these figures with a business advisor to assess the potential financial requirements and risks associated with starting The Standardx franchise. The FDD also clarifies that the estimate does not include any finance charges, interest, or debt service obligations. Understanding these inclusions and exclusions is crucial for franchisees to plan their finances accurately and avoid unexpected costs during the critical initial phase of operation.