Prepared by: HOW MUCH DOES IT COST. TO OPEN A FRANCHISE? (and Seven Other Essential Answers to Know Before You Invest)

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1 Prepared by: HOW MUCH DOES IT COST TO OPEN A FRANCHISE? (and Seven Other Essential Answers to Know Before You Invest)

2 A 2017 Guide to Opening a Pretzelmaker Franchise So you re thinking about investing in a Pretzelmaker franchise. When it comes to being your own boss and owning a business, investing in a franchise is one way to achieve that goal. As a franchise owner, you can enjoy ongoing support from a proven and established corporate model as well as nationwide brand recognition and an automatic customer base. The decision to invest is a big one, so it s important to be informed on all the issues that may arise as a franchise owner. Use this guide to answer eight of the most common questions that potential franchise owners ask us before they are awarded a Pretzelmaker franchise. PRETZELMAKER 2

3 How Much Does it Cost to Open My Own Franchise? The cost to open a franchise varies greatly depending on different factors that need to be taken into consideration. Some of these factors include: Location of your space (mall, traditional, non-traditional) Size of the space you re leasing If you decide to cobrand with another GFG brand Construction and real estate costs The amount of stores you decide to purchase Some municipalities require additional permitting, rent varies from location to location, some owners choose to add additional furniture, fixtures, and equipment to their stores, and so on. There are many different variables when it comes to startup costs for a Pretzelmaker franchise. It s important to remember, that no two stores are exactly the same and therefore no two startup costs are exactly the same. Because of these factors, it s impossible for us to determine an exact cost to start, but we do provide a range of investment in our Franchise Disclosure Document for your convenience. LOCATION Every location for a Pretzelmaker franchise will be different which means that the costs are going to vary from owner to owner. Certain states may require certain taxes or fees while other states may require something different entirely. SIZE OF STORE The store size of a Pretzelmaker franchise will also vary. Some might be located in the food court of a shopping center while others might be located elsewhere. We see stores range from square feet. Some stores are in corner locations where some are narrow but offer great depth. The key thing to remember is no two stores are the same and neither are the costs associated with the construction. FRANCHISE FEE Once you take into account the Pretzelmaker franchise fee of $25K, our franchise owners usually spend anywhere from $205,200 to $327,000 on their startup costs. These costs vary widely based on the criteria mentioned above. $ NECESSARY LIQUID ASSETS As you are preparing to invest in a Pretzelmaker franchise, know that we require our franchise owners to have a minimum net worth of $250,000 and at least $100,000 in liquidity. These numbers apply to one store but this is only an estimate and your costs may vary. MARBLE PRETZELMAKER SLAB CREAMERY 3

4 What Does a Day in the Life of a Franchisee Look Like? We don t want to sugar coat it (or cover it in salt, dip it in cheese, savor the buttery softness of the warm pretzel wait what are we talking about?), but owning a franchise is hard work. Nothing in life worth having ever came easy right? What Experience Do I Need To Open a Franchise? The most important trait that our franchise owners have is the willingness to work hard and follow our system. One of the biggest pros for owning a franchise is the system we have in place. This allows those without prior experience the ability to run a business they have no knowledge in. Sticking to the system and learning from other successful franchisees is vital. Additionally, we like our franchisees to be positive, outgoing, friendly, ambitious, and self-motivated. It s an additional bonus for us if a franchise candidate has previous restaurant experience or business experience, but neither are necessary. Do not despair, though, because the hard work you are doing as a Pretzelmaker franchise owner is some of the most fulfilling work there is because you are furthering your own goals and dreams. As a business owner, you can take comfort in knowing that you are working towards building your own dream, not that of someone else. Whenever an issue arises or something doesn t work just right, our franchise owners can call their personal advisor for assistance. A day in the life of a Pretzelmaker franchise owner is fulfilling because above all, when you own your own business, you are working toward your own goals. But don t take our word for it! Get in touch with some of our existing franchise owners to find out what they do day in and day out. PRETZELMAKER 4

5 What Kind of Training and Support Can I Expect? One of the key benefits of opening a franchise rather than starting a business from the ground up is the support and training you will receive from corporate. At Pretzelmaker, our franchise owners are our priority, which is why we take such great care to train them and continue to be there to help them should trouble arise. Below are several things franchisees can expect in regards to training. GFG UNIVERSITY As a Pretzelmaker franchise owner, you will receive initial training at the Global Franchise Group, or GFG, University in Atlanta, Georgia. At this training, our goal is for you to be able to do the following: Develop and be able to execute an effective Local Store Marketing Plan Understand Return on Investment (ROI) and the effect building revenues and controlling costs have on this Develop an annual financial plan Learn to analyze key components of the Profit and Loss (P&L) Statement Understand the most important aspects of cost controls, including Cost of Goods Sold (COGS) and Labor Costs Understand the importance of regular and accurate inventory counts and calculations Understand and be able to execute key Human Resource systems, including; Recruiting, Interviewing, Selecting, Training and Coaching Understand the importance of complying with Federal and State Labor Laws Learn the process involved during the weeks and days prior to opening to ensure the best possible guest experience IN-STORE TRAINING The training doesn t stop once you leave the GFG University. In fact, there will be a field representative with you every step of the way of opening and maintaining your franchise. This means that you ll receive additional training to get you on your feet as you learn how to run and manage your Pretzelmaker store as soon as it s open. FIELD BUSINESS CONSULTANT In addition to the training at GFG University, a franchise business consultant from corporate will be there when you open your store, helping you with the day-to-day aspects of owning and managing a Pretzelmaker. During this one-on-one training time, you will develop a personal relationship with the franchise business consultant (FBC), whose years of experience can help keep you from making common mistakes at opening and operating your business. This personal relationship can also be an asset down the road as you have questions arise or you are looking for ways to grow your business. MARBLE PRETZELMAKER SLAB CREAMERY 5

6 How Do I Find My Location? At Pretzelmaker, we know that location can make all the difference in your franchise, so we have a real estate team that is available to assist you in market research, site location analysis, as well as demographic information. As an added benefit of investing with Pretzelmaker, our brand recognition and reputation makes your business a desirable tenant to most landlords. How Much Are Your Royalties? Our Royalties are 7% of Net Sales* for the preceding week and 1.5% for our marketing royalty. The Royalty fee is an ongoing fee that provides ongoing brand recognition, a Franchise Business Consultant, training and ongoing support, real estate and construction assistance, preferred vendors, and marketing and advertising. They also cover ongoing online training, updates to operating manuals, updates to marketing collaterals and branding, and ongoing consulting from our Operations team to help you run your business. What Are Your Financial Requirements? The liquidity requirements for this investment level are a minimum of $100,000 and a minimum net worth of $250,000. Liquidity can be in the form of cash, stocks, bonds, retirement accounts, and home equity. PRETZELMAKER 6

7 How Much Money Can I Make? Because of the regulations on the franchise industry, we are unable to promise exact earnings to our potential franchise owners. However, there are two main ways to get an idea of what to expect when you invest in a Pretzelmaker franchise. First, visit and submit your contact information to speak to one of our Franchise Development Managers and obtain a Franchise Disclosure Document. This document contains earnings claims companywide and can be extremely informative. Once you have received the FDD, you will have the contact information for our franchise owners. You re free to call our owners at your leisure and ask them any questions you would like about our business. Current franchisees are allowed to share with you the percentages they see for ROI, labor, rent and COGS(cost of goods sold). It s also a great idea to ask them how they became successful and what you should be doing from a new owner perspective to reach you highest potential. QSR & FAST FOOD INDUSTRY While we cannot give specific numbers, we can show you some data that can give you an idea of the opportunity available in the Quick Service Restaurant and Fast Food industry. As time goes on, Quick Service Restaurants are becoming more diverse and less dependent on the hamburger and French fry model, leaving ample space for Pretzelmaker. If you d like to find out more, please visit This industry earned *$200 billion in the United States alone in 2015*, with profits projected to continue to rise. Indeed, revenue in the industry is expected to go up by 2.5% each year between now and 2020, as consumers have not stopped giving patronage to these establishments. All materials have been prepared for general information purposes only to permit you to learn more about the FDD. The information presented is not legal advice, is not to be acted on as such, may not be current and is subject to change without notice. The information presented is a summary of the disclosures required by the Federal Trade Commission. The terms of your contract will govern your franchise relationship. Don t rely on the disclosure document alone to understand your contract. Read your entire contract carefully. Show your contract and the FDD to an advisor, like a lawyer or an accountant. This information is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for information purposes only. Currently, the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. If you are a resident of or want to locate a franchise in one of these states, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your state. Franchise offerings are made by the Franchise Disclosure Document only. For New York: This advertisement is not an offering. An offering can only be made by a prospectus filed first with the Department of Law of the State of New York. Such filing does not constitute approval by the Department of Law. For Minnesota: MN File No. F Glenridge Connector, Suite 850, Atlanta GA SOURCES franchiseinfo@gfgmanagement.com