Erik’s DeliCafe
Date Incorporation: 1977
Franchising Since: 1986
Headquarters: California
Description: The franchise is for a retail food establishment under the name "Erik’s DeliCafe" offering a variety of delicatessen style food in a cafe-style, relaxing atmosphere.
Franchise Offer: The franchisor franchises the right to operate a DeliCafe which serves delicatessen-type food, prepared according to the franchisor's recipes and specifications, in a cafe style, relaxing atmosphere. DeliCafes serve food items that are made fresh with natural ingredients from family recipes.
Financial Assistance: The franchisor does not offer direct or indirect financing. However if the franchisee purchases from the affiliate an existing DeliCafe that will be operated under the franchise agreement, the affiliate may offer financing.
Training and Assistance: The franchisor will help with site selection, planning and construction. During a continuous period of up to 10 days following the opening of the DeliCafe, the franchisor will furnish a representative to aid the franchisee in learning operations and to assist in establishing standard operating procedures. The franchisor will provide an initial training program for the franchisee and if required, one additional person. The initial training program will be held at the franchisor's corporate headquarters and/or a DeliCafe selected by the franchisor and will last from 1 to 3 months, depending on the background and experience of the people being trained. The franchisor will also train a maximum of 5 of the DeliCafe employees for up to 10 days at a DeliCafe selected by the franchisor before the opening of the DeliCafe.
Territory: The franchise agreement provides that, during the term of the franchise agreement but subject to conditions, the franchisor will not itself operate, or license others to operate, an Erik's DeliCafe anywhere within the designated area of the franchisee's DeliCafe. Except to this extent, the franchisee does not receive an exclusive territory.
Term of Agreement and Renewal: The term of the franchise agreement is 10 years and can be renewed for another 10-year term, if the franchisee is not in default of the franchise agreement.
Obligations and Restrictions:
The franchisor requires the franchisee’s direct, full time on premises participation in the franchised DeliCafe during their first year of operation as a franchisee. After the first year, although the franchisor recommends the franchisee’s direct participation, they may devote less than full working time to the DeliCafe if they employ one or more competent managers.
The franchise agreement requires the franchisee to offer and sell only those foods, beverages and other products that the franchisor approves in writing. The franchisee is also required to provide all food and beverage products authorized or required to be provided as part of the franchisor's system, and to discontinue offering or selling any food or beverage product or service that the franchisor may periodically disapprove.
Total Number of Units: 24 units by year end 2007
Total Number of franchises Units: 23 franchised units by year end 2007
Investment Tables:
Initial Investment:
| Expenditures | Low | High |
|---|---|---|
| Franchise Fee | $10,000 | $10,000 |
| Pre-Opening Service Fee | $10,000 | $10,000 |
| Leasehold Improvements | $86,150 | $205,000 |
| Architect Drawings | $10,000 | $26,000 |
| Furniture, Fixtures, Equipment | $125,000 | $185,000 |
| Decor Package | $10,000 | $15,000 |
| Initial Inventory | $12,000 | $20,000 |
| Computer System | $2,000 | $5,000 |
| 1st Month's Rent & Deposits | $5,000 | $20,000 |
| Advertising For Grand Opening | $2,500 | $2,500 |
| Uniforms | $500 | $650 |
| Miscellaneous | $7,000 | $15,000 |
| Additional Funds (3 months) | $75,000 | $165,000 |
| Total | $355,150 | $679,150 |
Ongoing fees:
| Name of Fee | Amount |
|---|---|
| Royalty Fee | 5% of Gross Revenue |
| Network Marketing Fund | Currently 2.5% of Gross Revenue |
| Premises Lease Payments | Varies depending on market conditions, lease rates, the lease terms, etc. |
| Decor Lease Payments | $96 per year |
| Proprietary food items | Varies |
| Renewal Fee | $5,000 |
Date of FDD: March 28 2008
The above information has been taken from the UFOC/FDD of Erik’s DeliCafe
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