Kumon North America, Inc.
Date of Incorporation: 1958
Franchising Since: 1958
U.S. Headquarters: Teaneck, New Jersey
Country of Origin: Japan
Description: Kumon North America, Inc. is a wholly owned subsidiary of Kumon Institute of Education Company, Ltd., a Japanese corporation. The Kumon Method is a mastery-based system in which excellence is determined through speed and accuracy. The Kumon Math and Reading curriculum worksheets are the essence of the Kumon Method. There are 22 math levels and 24 reading levels covering material ranging from pre-school to college level.
Franchise Offer: The franchisee will operate an after-school center that provides math and reading programs using the Kumon Method of learning. Children are given the opportunity to attend Kumon Centers twice each week throughout the year for approximately 20-30 minutes per subject and complete daily assignments at home on non-Center days.
Financial Assistance: The franchisor does not offer direct or indirect financing nor do they guarantee any promissory note, lease or other obligation the franchisee may make to others.
Training and Assistance: The franchisor will provide Start-Up Training Days 1- 8. After the franchisor and Kumon University have registered the franchisee for training, he or she will be lent the training kit, which includes in part the Start-Up training manual. The franchisee shall also be able to consult the operations manual for reference only. The franchisee will use these materials at the Start-up training program as part of the training materials. After Start-Up Training Days 9-11, the franchisee must complete ongoing training, which continues for the term of the franchise. Ongoing training includes instructor achievement testing, attendance at monthly instructor meetings and/or other professional development activities, in accordance with the training schedule set forth in the operations manual.
Territory: The franchisee will not receive an exclusive territory within the Kumon franchise organization for the operation of the center(s). He or she may face competition from other franchisees, from centers owned by the franchisor, or from other channels of distribution or competitive brands controlled by the franchisor.
Term of Agreement and Renewal: The length of the initial term is 3 years. If the franchisee is in good standing and has met the requirements for renewal, he or she can renew the franchise agreement for 5-year terms.
Obligations and Restrictions: If the franchisee is an individual, he or she must instruct the students personally. He or she must be at the center during all student sessions except in extraordinary circumstances of a personal nature. He or she must devote full-time to the operation of the Kumon franchise throughout the franchise relationship. The franchisee may offer only the Kumon Math and Reading programs, and only in accordance with the Kumon method, using only Kumon materials as the instruction manual and other instructional materials in the center. The franchisor must pre-approve the use of any additional services, programs and/or products developed for the center.
Total Number of Units: More than 1,500 Kumon Centers in North America. More than 25,000 worldwide.
Investment Tables:
Initial Investment:
| Expenditure | Low | High |
|---|---|---|
| Training agreement deposit fee | $500 | $800 |
| Start-up training | $3,020 | $4,240 |
| Initial franchise fee | $1,000 less the $500 or $800 Deposit Fee | $1,000 less the $500 or $800 Deposit Fee |
| Initial purchase of materials | $1,000 | $1,000 |
| Architect design | $0 | $5,000 |
| Leasehold improvements | $5,000 | $50,000 |
| Security deposit | $0 | $4,500 |
| Rent | $1,500 | $4,000 |
| Furniture, signs, personal equipment and supplies | $5,000 | $30,000 |
| Notebook computer at Kumon center | $800 | $2,000 |
| Professional fees | $1,000 | $3,000 |
| Liability insurance | $350 | $350 |
| Business license, name registration | $100 | $200 |
| Separate business phone line and answering system for Kumon center | $150 | $300 |
| Grand opening advertising | $500 | $2,000 |
| Junior Kumon Kit | $720 | $720 |
| Junior Kumon complete recommended reading list | $800 | $800 |
| Fingerprinting, criminal background check | $18 | $60 |
| Additional funds (3 months) | $12,000 | $21,000 |
| Total | $32,958 | $131,070 |
Ongoing Fees:
| Name of Fee | Amount |
|---|---|
| Royalty Initial Enrollment Royalty Fee | For each reporting month, $15 times the number of newly enrolled students. Monthly Royalty During Temporary License Period: $36.00 times the number of full-payment students enrolled and $18.00 times the number of and $18.00 times the number of partially exempt and/or prorated partially exempt and/or prorated tuition students for each Subject- Franchise. Monthly Royalty after completing the temporary license period: $32.00 times the number of full-paying students enrolled, and $16.00 times the number of partially exempt and/or prorated tuition students for each Subject-Franchise |
| Administrative fee for late payment | 1.5% on the overdue amount each month or $75, whichever is higher |
| Late Report Fee for late submission of student reports, applications, and tests | $200 per month |
| Insufficient Funds | $25 per EFT attempt that has insufficient funds to cover the amount owed |
| Insurance | $3.50 per math student per year |
| Indemnification | Cost of indemnification |
| Shipping Costs for Materials | Cost per order |
| Relocation Fee | $1,000 |
| Liquidated Damages-termination without adequate written notice | Three times average monthly royalty in the three months immediately prior to the last day of operating the Center |
| Temporary Transfer | 10% of then current amount of Kumon's recommended tuition multiplied by the number of students enrolled at the Center for so long as Kumon has assumed operation of the Center(s) |
| Background Checks | Determined by vendor |
Date of FDD: 2009
The above information has been compiled from the FDD of Kumon along with online sources.
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