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It's a Grind Franchise Cost & Fees

Date of Incorporation: 2000

Franchising Since: 2001

Headquarters: California

Business and Description: IAG Coffee Franchise LLC franchise the right to operate retail specialty coffee beverage stores offering fresh roasted specialty whole bean coffees, traditional and espresso-based coffee drinks, iced and blended coffee drinks, tea and tea-based drinks, fruit smoothies, breakfast items, sandwiches, salads and assorted bakery products.

Franchise Offer: The Franchise on offer is to operate a single ‘It's A Grind’ store. If you sign a Non-Refundable Deposit Option Agreement along with your initial Franchise Agreement, you will pay an Initial Franchise Fee of $30,000, in lieu of the standard $36,000 Initial Franchise Fee. The franchisee will also pay a $15,000 Non-Refundable Deposit Option Fee towards a second franchise, for which there will also be an Initial Franchise Fee of $30,000. The remaining $15,000 of the second Initial Franchise Fee is payable if the franchisee signs a second ‘It's A Grind’ Franchise Agreement.

Financial Assistance: IAG Coffee Franchise LLC does not offer direct or indirect financing nor do they guarantee any note, lease or other obligation.

Training and Assistance: Each new franchise owner is required to attend a 10 day training program. The program consists of both in-store and classroom instruction and will cover all aspects needed to operate an ‘It's A Grind®’ store.

Territory: Unless IAG Coffee Franchise LLC specifically designates an Authorized Location as a traditional site with a Protected Area the franchisee will not have a Protected Area. If the Authorized Location is identified by IAG Coffee Franchise as a traditional site then the Protected Area will consist of a circular area defined by a radius of 1/2 mile from the front door of the franchisee’s It's A Grind Store and for the term of the Agreement IAG Coffee Franchise will not establish a traditional, full service It's A Grind Store within the Protected Area.

Renewal and Termination:
The initial term is the shorter of 10 years or the length of the term of the lease for the authorized location. The renewal term is for the length of the new lease for the authorised location. The franchisee can terminate as permitted by law. The franchisor will not terminate without cause.

Obligations and Restrictions: The franchisee must offer and sell only those goods and services that have been approved. The business is to be used solely for the operation of the business licensed under the Franchise Agreement. The franchise and the store manager must attend and successful complete the initial training program. The franchisee is not required to personally manage the franchise. The store manager may assume the direct, day-to-day, full time supervision responsibilities.

Total Number of Company Owned Units for 2006: 6
Total Number of Company Owned Units Opened for 2006: 2
Total Number of Company Owned Units Closed for 2006: 0

Total Number of Franchised Units for 2006: 96
Total Number of Franchised Units Opened for 2006: 28
Total Number of Franchised Units Closed for 2006: 12

Investment Table:

Estimated Investment for Single Unit Franchise:

Name of Fee Low High
Initial Franchise Fee $25,000 $36,000
Leasehold Improvements (W/out Drive-Thru) $145,000 $210,000
Equipment, Furniture, Fixtures & Computer System (W/out Drive-Thru) $87,000 $100,000
Signage (W/out Drive-thru) $6,000 $168,000
Rent and Security Deposits $5,000 $15,000
Professional Fees/Services $16,500 $25,000
Insurance $2,500 $3,000
Travel and living expenses while Training $1,000 $3,500
Opening Inventory $6,000 $9,000
Grand Opening Fee $5,000 $5,000
Additional funds-6 months $25,000 $75,000
Total (Without Drive-Thru) $324,000 $499,500

 

Ongoing Costs for Single Unit Franchise:

 

Name of Fee Amount
Continuing Royalty Fee 6% of gross sales
Advertising and National Marketing and Development Fund Fee 1% of gross sales
Enterprise system and gift card program fees $130/month
Gift card sales Face value of gift card
Advertising Cooperative Fees Not yet established
Interest and Late Payment Charge 1.5% of delinquent amount per Month
Audit Fees Underpayment plus interest plus cost of audit
Renewal Fee $7,500
Transfer Fee $5,000
Additional Training Expenses Varies
Management Fees Reasonable management fees plus expenses
POS Maintenance $2,000 annually (approximately)
Technology Fee    $20/month; The franchisor has the right to require additional fee if they authorize additional users
Indemnification Reimbursement of damages and losses

The above information has been taken from the UFOC/FDD of IAG Coffee Franchise LLC.

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