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Sylvan Learning Franchise Cost & Fees

Date of Incorporation: 1979
Franchising Since: 1980
Headquarters: Baltimore, Maryland

Business Description: Sylvan Learning, LLC is the franchisor. The franchisee will operate a Sylvan-branded learning center with a system designed for specialized assessment and teaching of individualized educational programs for children in the principal areas of reading, mathematics, writing and test preparation. Also offered is SylvanSync, SylvanSync. The SylvanSync system may be licensed to certain franchisees, but only as part of a separate SylvanSync Beta 3 Agreement.

Franchise Offer: The Sylvan System franchise opportunity is a license to operate using Sylvan's proprietary Sylvan Systems and SylvanSync System at Sylvan Learning Centers and other approved locations. The SylvanSync System and Sylvan System are separate licenses (which are licensed under the same agreement) and systems, but products and services of both are offered alongside each other from the Centers and other approved locations.

Financial Assistance: Sylvan does not offer any direct financing of franchisees’ initial license fee or operating expenses of the Center or SylvanSync business. However, franchisees may obtain financing for equipment purchases and purchases of educational materials from third parties.

Training and Assistance: Sylvan provides franchisees and their staff certain training through its "Sylvan University” department and through “Sylvan University Now” (SUN), its proprietary online learning management system for Sylvan franchisees and staff. Sylvan provides an initial training program for up to three members of a new franchisee's staff (including the franchisee). The Initial Training Program includes generally begins with a conference call with a New Franchise Services consultant. Initial training takes place in Baltimore, MD or on-site at the franchisee’s Center, or at another location as the franchisor determines based on need and Sylvan instructor schedules. At least once every two years, Sylvan will hold an Annual Conference at a location it determines.

Territory: Territories are either a Territory A, which has 18,000 - 30,000 (or more) school-aged children (five to 17 years-old), or a Territory B, which has 8,000 to 18,000 school-aged children. Each Territory is delineated by geographical or political boundaries, streets or an area within a specified radius from an identified point. Franchisees will receive an exclusive Territory, which means that except as Sylvan provides in the License Agreement, it will not operate or license to others the right to operate a Sylvan Learning Center utilizing the Sylvan System within a franchisee’s Territory so long as their License Agreement remains effective and they are in compliance with its terms and conditions.

Term of Agreement and Renewal: The length of the initial term is 10 years. If the franchisee is not in default and has complied with the License Agreement terms, the franchisee can renew for 10 years (unlimited additional renewals). A month-to-month renewal is also possible, subject to 30 days’ notice of termination by the franchisee or Sylvan.

Obligations and Restrictions: The center must at all times meet franchisee management, educational staffing, and certification requirements. To satisfy the management requirement, franchisees must devote at least 70% of normal working hours to operation of the Center(s) across their enterprise. If franchisees are a partnership, corporation, or other business entity, franchisees must designate one of franchisees owners to devote at least 70% of normal working hours each week to the operation of your Sylvan Center(s). The franchisor refers to this individual as the “Managing Principal.” Each of the Centers must have at least one Center Director and at least one Director of Education on an ongoing basis once franchisees begin to offer services. At least one of the Directors must work full-time in the Center. The other Director(s) may be full-time or part-time. The courses of instruction and services that franchisees may offer at their Center are limited to (1) the educational programs Sylvan licenses to franchisees pursuant to the License Agreement; and (2) any other programs that Sylvan specifically approve in writing. Franchisees are not required to offer all of the educational programs Sylvan licenses, but franchisees are required to offer those indicated as mandatory in the franchise disclosure document, in the Confidential Manuals, or otherwise in writing.

Estimated Number of Units: 646

Investment Tables:
Initial Investment
Name of Fee Low High
Initial Franchise Fee $24,000 $24,000
Travel and Living Expenses While Attending Initial Training $900 $1,500
Initial Three Months' Rent and Security Deposit $3,750 $15,000
Real Estate Improvements and Site Preparation $2,000 $38,000
Initial Inventory of Sylvan Learning Materials $2,800 $2,800
Initial Instructional Materials from Third Parties $150 $200
Specialized Furnishings $5,300 $10,000
Other Furniture and Miscellaneous Supplies $3,000 $4,000
Signage $4,000 $8,000
Marketing during Initial 3 month Period when the Primary Center First Opens in Your Territory $10,000 $10,000
Computers, Copier, Printers, Facsimile, Telephone, Internet Access & Software $6,690 $11,420
FOA Annual Membership Fee for Initial Period $660 if the franchisee is licensed to operate 1 Center
Estimated Fee or Rent for Temporary Satellite $250 $3,000
Miscellaneous Supplies (Markers, buckets, pens, pencils, etc.) $15 $25
Portable SylvanSync Kit (for transporting to Satellites) and signage $115 $430
Additional Funds (three months) $7,350 $430,850
ESTIMATED TOTAL (figures do not include additional rent) $70,980 $159,890
Other Fees
Type of Fee Amount
Royalty 16% of monthly gross revenues, with a total Minimum Annual Royalty of not less than $32,000
Purchases of SYLVAN Learning Materials Varies.
Additional Training In connection with all trainings, franchisees must pay all costs and expenses they or their staff who participate incur, including travel and living expenses and wages for them and their staff.
Territory Advertising Minimum for Local Advertising and Co-op Expenditures 8% of monthly gross revenues, capped at a maximum of $40,000 per Territory per calendar year.
Audit Cost of audit plus late fee on deficiency.
Transfer Fee $6,000, and $3,000 in case of transfer to existing SYLVAN licensee.
Renewal Fee 10% of the initial license fee set forth in SYLVAN's then-current form of license agreement.
Additional Center Administrative Fee $1,000
Territory Upgrade Fee $10,000 for Territory addition plus Incremental fee of $2.00 per school age child over 5,000
Territory Split Fee $5,000 for Territory Splits.
Resale Assistance Program Up to 5% of the purchase price, and may include a $500 fee payable upon enrollment.
Liquidated Damages for Breach Average monthly royalty over preceding 36 months.

The above information has been taken from the FDD of Sylvan Learning. Year of FDD: 2016

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