TeaGschwendner
Date Incorporation: 1978
Franchising Since: 1980
U.S. Headquarters: Illinois
Country of Origin: Germany
Description: The franchisor operates a system of tea shops under the name “TeaGschwendner”, offering premium loose, packaged and ready to drink tea; fruit, spice and other infusion products and related accessories, products and services.
Franchise Offer: The franchise offered is for the right to operate a retail tea store business under the trademark “TeaGschwendner”.
Financial Assistance: The franchisor does not provide direct or indirect financing.
Training and Assistance: The franchisee and one of the manager-level employees must complete the initial training program on the material aspects of operating a TeaGschwendner Store. This training consists of 10 hours of classroom training and 142 hours of on-the-job training, located in Chicago, Illinois. Three days before the grand opening, the franchisor will send a representative to the new TeaGschwendner Store for a period of seven days to assist the new franchisee with its opening.
Territory: The franchisor will not receive an exclusive territory.
Term of Agreement and Renewal: The length of the franchise term is 10 years, with an option to acquire a successor franchise under the then current terms.
Obligations and Restrictions: The franchisee must act as the general manager of the TeaGschwendner Store with responsibility for direct, on-premises supervision of the store. They must keep inform the franchisor at all times of the identity of any supervisory employee(s) acting as assistant manager(s) of the store. The franchisee must devote full time and efforts to the management and supervision of the store.
Total Number of Units: 145 units.
Investment Tables:
Initial Investment:
| Expenditures | Low | High |
|---|---|---|
| Franchise fee | $15,000 | $25,000 |
| Travel and living expenses during initial training | $2,000 | $5,000 |
| 3 months' rent | $9,000 | $25,000 |
| Grand Opening Advertising | $5,000 | $5,000 |
| Start-up inventory and supplies | $30,000 | $45,000 |
| Construction, leasehold improvements and decorating costs | $40,000 | $125,000 |
| Furniture, fixtures, equipment, installation and set-up | $50,000 | $75,000 |
| Signage | $5,000 | $10,000 |
| Insurance | $500 | $2,000 |
| Licenses and permits | $1,000 | $3,000 |
| Utilities for 3 months, including any security deposits | $500 | $3,000 |
| Additional funds for 3 months | $7,000 | $27,000 |
| Total Estimated Initial Investment | $165,000 | $350,000 |
Ongoing fees:
| Name of Fee | Amount |
|---|---|
| Royalty | Up to 3% of Gross Sales |
| Advertising Fund | Up to 2% of Gross Sales |
| Late payment interest | 1.5% per month or the highest commercial contract interest rate the law allows, whichever is less |
| Additional training | Will vary with the circumstances, but will not exceed the franchisor's expenses to conduct the training plus the travel and living expenses to attend |
| Refresher Training | Will vary with the circumstances, but will not exceed the franchisor's expenses to conduct the training plus the travel and living expenses to attend |
| Renewal fee | $2,500 |
| Transfer fee | $5,000 |
| Relocation fee | The franchisor's then current fee and expenses |
| Replacement of Lost Operations Manual | $50 |
| Costs and attorneys' fees | Will vary with the circumstances |
| Indemnification | Will vary with the circumstances |
| Audit expenses | Cost of audit and interest |
| Special marketing, management, and operational assistance performed at ynur request | The franchisor's then current fee and expenses, including their personnel's per diem charges and travel and living expenses |
| Equipment repair services | Will vary with the circumstances |
| Information Technology Service Fee | $500-$600 per month |
| Insurance | Cost of premiums plus their costs and expenses |
| Management Services Fee | Up to 20% of Gross Sales, plus costs and expenses |
Date of FDD: 2009
The above information has been taken from the UFOC/FDD and online sources of TeaGschwendner
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