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Saxbys Coffee Franchise Cost & Fees

Date of Incorporation: 2005

Franchising Since: 2005

Headquarters: Georgia

Business and Description: Saxbys Coffee Inc. acquired the majority of the assets of Proven Record, Inc. their predecessor, the prior franchisor, including all of its signed franchise agreements. This acquisition took place on August 23, 2005. Saxbys Coffee Shops offer customers a variety of food items including coffee, gourmet pastries, bagels, muffins, fruit smoothies, cold beverages and other related items.

Franchise Offer: The franchise offered is the right to own and operate a Saxbys Coffee Shop. Saxbys Coffee Inc. offers a Multi Unit Operator the opportunity to develop a certain amount of Saxbys Coffee Shops within a specific area. Saxbys Coffee Inc. also offers qualified applicants the right to become an Area Developer within a defined geographic area. The franchise fee ranges from $10,000 - $50,000. This range is based on the average per capita income of the households in the territory.

Financial Assistance:
Saxbys Coffee Inc. does not offer any direct of indirect financing nor do they guarantee any note, lease or obligation.

Training and Assistance:
Saxbys Coffee Inc. provides training for the franchisee and 2 additional people without charge. The training consists of both classroom and on the job training for approximately 5 days.

Territory: Under the Franchise Agreement the franchisor grants the franchisee the right to operate a Saxbys Coffee Shop at a specific location. The franchisor grants the franchisee an exclusive territory which will be determined.

Renewal and Termination: The term for the franchise agreement is 10 years with two 5 year renewal terms if certain requirements are meet. The renewal fee is $5,000. Neither the franchisee nor the franchisor can terminate without cause.

Obligations and Restrictions: The Franchise Agreement requires the franchisee or a Principal Owner whom Saxbys Coffee Inc. approve to personally participate in the day-to day operation of the Saxbys Coffee Shop. The franchisee must offer all products and certain complementary products and services that the franchisor designate as required for Saxbys Coffee Shops.

Total Number of Company Owned Units for 2005: 1
Total Number of Company Owned Units Opened for 2005: 0
Total Number of Company Owned Units Closed for 2005: 0

Total Number of Franchised Units for 2005: 2
Total Number of Franchised Units Opened for 2005: 0
Total Number of Franchised Units Closed for 2005: 0

Investment table:

Estimated Initial Investment for Single Unit Franchise:

Name of Fee Low High
Initial Franchise fee $10,000 $50,000
Leasehold Improvements $10,000 $85,000
Furniture, Fixtures and Equipment $58,929 $64,822
First 3 Month's Rent $9,000 $18,000
Opening Inventory and Supplies $6,000 $7,000
Signage $9,000 $18,000
Training Expenses $500 $3,000
Blue Prints, Plans, Permits $500 $5,000
Security Deposits (including lease deposit, utilities, licenses, etc.) $1,500 $4,200
Insurance (yearly) $500 $2,000
Grand Opening Advertising and Promotions $2,667 $2,933
Royalties Not Calculable  
Advertising Not Calculable  
Miscellaneous Opening Costs $0.00 $10,000
Additional Funds - 3 months $15,000    $30,000
Total Investment $123,596 $299,925

Ongoing Costs for Single Unit Franchise:

Name of Fee Amount
Royalty Fee 6% of Gross Revenue.
Transfer Fee 50% of the then current initial franchise fee
Renewal Franchise Fee $5,000
Audit Expenses Cost of audit will vary depending on the circumstances. The range is between $2,500 and $5,000 plus any deficiencies found.
Interest Highest legal rate or 4% above the prime rate
Costs and Legal Fees Will vary under circumstances
Indemnification Will vary under circumstances
National Marketing Fund Contributions 21% of Gross Revenue
Local Advertising The franchisee should spend at least 2% of their Gross Revenues on local advertising (see below).
Local Advertising Cooperative If established 2% of Gross Revenue
Insurance Costs Reimbursement of costs and premium
Additional Training $500 per day
Additional Guidance and Assistance Per diem charges of $500 and out of pocket expenses
Software Updates Actual costs of updated software programs and training (if applicable)
Product Purchases Proprietary products, if and when developed
Supplier Approval Actual costs of approving suppliers, which will not exceed $1,000.

The above information has been taken from the UFOC/FDD of Saxbys Coffee Inc.

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