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Auto-Lab Franchise Cost & Fees

Date of Incorporation: April 2, 2004

Franchising Since: June 2004

Address: Michigan

Description: Auto-Lab franchise Management Corporation grants franchises for the operation of a business offering automotive and engine diagnostics, electrical system repair, air conditioning repair, engine repair and other automotive related repair and maintenance services.

Franchise Offer:
i)      Single-unit franchises that open a new automotive repair facility using the system at a single location.
ii)     Option to convert an existing automotive repair facility to a single-unit franchise using the System ("Conversion").
iii)    Master Franchises to Master Franchisees, who will develop, operate and recruit franchisees to develop Auto-Lab stores within a geographic region.

Financial Assistance: Auto-Lab does not offer direct or indirect financing and does not guarantee note, lease or other obligation.

Training and Assistance: 4-week course of instruction at a designated location that will cover all operating phases of the franchised business. Auto-Lab will administer the training program at its home office and/or at an Auto-Lab location. Generally, the curriculum includes general business procedures, advertising and promotion, nature of the franchise business and effective methods and techniques for servicing customers. Auto-Lab will not charge for the initial training program apart from the initial franchise fee.

Territory: Auto-Lab grants the right to operate one franchise location at a site approved by them in a designated area, which will generally be approximately 3 miles in radius, depending upon the demographics of the region. Auto-Lab will not operate stores or grant franchises to other "Auto-Lab" franchisees, in the Designated Area.

Franchise Term and Renewal: The term of franchise is 15 years. If in good standing, the franchisee can renew for an additional 15 year period.

Obligations and Restrictions: The franchisee does not have to personally supervise the franchised business. But the business must be directly supervised "on-premises" by a manager who has successfully completed the training program.

Total Number of Units: 29 franchised units at the end of the year 2006.

Financial Statements: Net income of $18,439 for the year ended 2007.

Investment Table:
Initial Investment:

Name of Fee Low    High
Initial Franchise Fee $25,000 $25,000
Equipment $60,000 $119,000
Inventory $2,500 $5,000
Leasehold Improvements $5,000 $40,000
Training Expenses $2,000    $5,000
Pre-Opening Expenses $3,000 $20,000
Real Estate Costs (3 months) $0 $24,000
Additional Funds $10,000 $50,000
Insurance (3 months) $2,500 $3,000
Total $110,000 $291,000

Ongoing Fees:

Name of Fee Amount
Royalty 7% on weekly Gross Sales. The franchisor permits a 1% Royalty discount if paid timely.
Advertising Up to 3% of weekly Gross Sales
Yellow Pages $800-1900 per month
Local Advertising 3% of Gross Sales
Software Licenses $150 per month
Additional Training/Assistance $600 per day per trainer, plus expenses
Late Charge 1.5% per month or maximum legal rate, whichever is lesser amount
Cost of audit ($12,000 in 2004), plus Royalty and Advertising Fees due on
understatements, plus Late Charges
Supplier and/or Product Approval $500-$ 1,000 payable to the franchisor and non-refundable
Transfer 50% of the then initial franchise fee charged to new franchisees
Management Fee 10% of weekly Gross Sales
Renewal 50% of the initial Franchise Fee for new franchisees
Attorneys' Fees Actual expenses
Website Fee $25.00 per month


The above information has been taken from the UFOC/FDD of the Auto-Lab Franchise Management Corporation.

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