STEMTech Kids Franchise Cost & Fees
Date of Incorporation: 2013
Franchising Since: 2014
Headquarters: Naperville, Illinois
Business Description: STEMTech Kids Franchise Inc. is the franchisor. “STEM” stands for Science, Technology, Engineering and Math. The franchise system is for operating a children's education and entertainment business specializing in conducting creative, interactive, hands-on STEM activities, including camps, after school programs, workshops and other events, and related products and services. The camps, programs, workshops, parties and events will be conducted primarily at public and private schools and universities, park district facilities, community centers and similar locations.
Franchise Offer: The franchisee will conduct a children's education and entertainment business offering interactive, hands-on STEM activities, including camps, programs, workshops and other events and activities for children ages 3 to 13 following the system using a unique blend of STEM and fun.
Financial Assistance: The franchisor does not offer any direct or indirect financing to franchisees. The franchisor does not guarantee any of the franchisees’ purchases, leases, contracts or other obligations.
Training and Assistance: Franchisees must attend and satisfactorily complete the 3 day Initial Training Program. There will be homework and presentation assignments as part of the initial training program. These hours will be outside and in addition to the classroom hours. The franchisor does not charge franchisees extra for him/her and up to 2 additional persons to attend the initial training program. Franchisees must pay travel and living expenses incurred. One of the franchisor’s representatives will come to franchisees’ site at no additional cost for one day around the time of their first scheduled event. The franchisor may conduct refresher training programs, seminars or national or regional conventions at locations it designates.
Territory: Franchisees will be granted a protected territory in which to operate the Business. The Territory granted to franchisees will contain a population of 50,000 to 60,000 and/or approximately 15 public and private elementary and middle schools. Upon the franchisee’s request, and if there is contiguous territory available, the franchisor may grant the franchisee a larger territory for a territory expansion fee of $18,000.
Term of Agreement and Renewal: The length of the initial franchise term is 10 years. If in good standing, franchisees can add one 10-year option to renew.
Obligations and Restrictions: Franchisees may not conduct classes in another franchisee's territory. Franchisees must not actively market their business outside of their territory. Franchisees must participate directly in the operation and management of the Business. Franchisees must operate the Business year-round on a full-time basis. The business must at all times be under the direct supervision of the franchisee or a full-time manager who has successfully completed Initial Training program and passed a background check. Franchisees must offer, sell and provide only those services and products which the franchisor approves, and franchisees must offer all services and products which the franchisor requires.
Estimated Number of Units: 1 (New Franchise System)
|Name of Fee||Low||High|
|Initial Franchise Fee||$25,000||$25,000|
|Furniture, Office Equipment & Computer System||$500||$1,500|
|Travel, Room and Board to Attend Initial Training||$600||$1,200|
|Miscellaneous Pre-Opening Expenses||$500||$1,000|
|Additional Operating Funds - Initial 3 Months||$1,200||$2,400|
|Type of Fee||Amount|
|Royalty||10% on first $75,000 in Gross Revenue and 8% on Gross Revenues in excess of $75,000 for each calendar. The franchisee must pay a minimum monthly royalty of $425 for a standard territory and a minimum monthly royalty of $650 if the franchisee purchases a larger territory.|
|System-Wide Marketing Fee||Up to 2% of Gross Revenues.|
|Local Advertising Expense||2% of Gross Revenues each, calendar quarter.|
|Late Fee and Interest||10% of unpaid amount plus interest of highest legal rate or 1.5%.|
|Supplemental (Training/Seminars/Conventions)||The franchisor determines the fee based on its cost of conducting training.|
|Additional Assistance||Currently $800-$1,200 per day plus travel expenses, if the franchisee requests additional assistance.|
|Approved Supply Request Fee||The franchisor’s cost of evaluating supplier.|
|Software License Fee||As determined at time of development.|
|Audit||If the Royalty Fee has been underpaid by more than 2%, the franchisee pays the franchisor the amount due plus its costs and 1.5% interest per month on the underpayment.|
|Indemnification||The franchisor’s costs and damages.|
|Insurance Reimbursement||The franchisor’s cost.|
|Attorneys’ Fees||Reasonable fees and costs.|
The above information has been taken from the FDD of STEMTech Kids. Year of FDD: 2014
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