Expedia CruiseShipCenters Franchise Costs & Fees
Date of Incorporation: 1987
Franchising Since: 1987
Headquarters: Bellevue, Washington
Business Description: CruiseShipCenters USA Inc. is the franchisor. The franchisor is a subsidiary of CruiseShipCenters International, Inc., which operates a travel agency and franchises travel agencies specializing in cruise vacations.
Franchise Offer: The franchise offered is for the operation of a travel agency business that offers reservations for cruise ships, airlines, car rentals and hotels, as well as other related travel services and products.
Financial Assistance: The franchisor does not offer direct or indirect financing. The franchisor does not guaranty franchisees’ notes, leases or obligations. Franchisees of the Expedia CruiseShipCenters System are eligible for expedited and streamlined Small Business Administration (SBA) loan processing through the SBA’s Franchise Registry Program.
Training and Assistance: Before franchisees begin operating their Travel Business, the franchisor will furnish training for up to two persons on the operation of a Travel business to franchisees (or if the franchisee is a business entity, to up to two owners). Trainees must complete the training program to the franchisor’s satisfaction and before commencing operations of the Travel Business. The Trainees will receive one week of online training through a correspondence course referred to as International Cruise Academy. The Online Training consists of online course modules, recorded webinars and student activity/practice exercises in the areas of Preferred Suppliers and Products, Prospecting, Selling, Servicing and Operations. Trainees will receive 5 days of classroom training (Cruise Management Academy) at one of the franchisor’s training facilities, currently located in Vancouver, British Columbia, Canada. All franchisees must attend the franchisor’s annual National Conference and Regional Franchisee meetings. The franchisor may offer additional training, including periodic and refresher training courses, at such times and locations that it designates.
Territory: Franchisees will receive a designated territory (Market Area) in which they may establish and operate one Center at one location. There is no minimum territory comprising a Market Area, however, the franchisor estimates a typical Market Area will have between 15,000 and 35,000 “Targeted Households” based upon data provided by a third-party company specializing in geographic-based information. A “Targeted Household” is one with an annual income of approximately greater than $75,000 (although the franchisor may adjust the dollar threshold to reflect changes in CPI, or for other reasons). The number of Targeted Households in a particular Market Area is based on a number of factors including local cost of living, shopping patterns, geographic aspects, market conditions and demographic criteria, including population density, average and median income and local competition. As long as franchisees are not in default under their franchise agreement, the franchisor will not open a Travel Business or allow any future franchisee the right to establish and operate an Expedia CruiseShipCenters franchise within the Market Area.
Term of Agreement and Renewal: The length of the initial franchise term is 5 years from the beginning of the Effective Date of the Franchise Agreement. If franchisees are in good standing and meet other requirements, they may obtain an additional 5-year Term.
Obligations and Restrictions: Franchisees (or one of the controlling owners if a business entity) must assume responsibility for the day-to-day management and operation of their Travel Business and the supervision of their Travel Business personnel. Franchisees must at all times faithfully, honestly and diligently perform their obligations under the Franchise Agreement, continuously exert their best efforts to promote and enhance their Travel Business and, not engage in any other business or activity that conflicts with their obligations to operate their Travel Business in compliance with the Franchise Agreement. Franchisees must offer and sell only the Travel Products and Services that the franchisor approves and must offer all Travel Products and Services available through CruiseDesk. Franchisees may not offer any products or services that are not approved Travel Products and Services available through CruiseDesk. Franchisees must operate their Travel Business in accordance with the franchisor’s standards of service, advertising, promotion and management. Franchisees must comply with all business policies, practices and procedures, as prescribed in the Manual or otherwise in writing from time to time.
Estimated Number of Units: 200
|Name of Fee||Low||High|
|Initial Franchise Fee||$39,900||$39,900|
|In-person Training – The Franchisee’s Transportation and Accommodation||$750||$2,500|
|In-person Training – Additional Trainee||$0||$495|
|In-person Training – Additional Trainee Transportation and Accommodation||$100||$1,700|
|Premises Lease Security Deposit||$1,500||$4,000|
|Utilities and Telephone Deposit||$30||$500|
|Signage (interior and exterior)||$1,600||$9,600|
|Computers and Software||$5,000||$8,200|
|Office Equipment and Supplies||$2,550||$4,365|
|Office Furniture and Furnishings||$9,550||$19,500|
|Telephone and Alarm Equipment, Installed||$1,800||$3,700|
|Business Licenses, Permits and Trust Accounts||$785||$3,700|
|Additional Funds – Working Capital for the first 3 Months||$20,545||$39,810|
|Type of Fee||Amount|
|Service Fee||9% of Gross Revenues paid to the franchisee by suppliers.|
|Management Information Systems (MIS) Fee||$300 per month.|
|Marketing Fee||$600 per month.|
|In-person Training: Cruise Management Academy (CMA) – Additional Trainee||$495|
|Additional Term Franchise Fee||$5,000|
|Document Administration Fee||The greater of $295 or the franchisor’s actual expenses incurred.|
|Site Relocation Fee||The greater of $995 or the franchisor’s actual expenses incurred in reviewing the franchisee’s relocation site and any document preparation or modification.|
|Audit Fee||Cost of inspection or audit and related expenses.|
|Interest||The lesser of 15% per annum or the highest contract rate of interest permitted by applicable law.|
|Insufficient Funds Fee||$50 per occurrence.|
|Costs and Attorneys’ Fees||Will vary under circumstances.|
The above information has been taken from the FDD of Expedia CruiseShipCenters. Year of FDD: 2016
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