Planet Smoothie Franchise Costs, Fees & FDD

Year Business Began: 1995

Franchising Since: 1998

Headquarters: Scottsdale, Arizona

Estimated Number of Units: 165

Franchise Description: The franchisor is Kahala Franchising, L.L.C. Franchisees operate a restaurant called “Planet Smoothie,” preparing and serving smoothies, smoothie bowls, fruit drinks, functional drinks, nutritional supplements, and other food and beverage items and related goods. Franchisees may (i) construct a new Planet Smoothie restaurant; (ii) purchase one of the franchisor’s Planet Smoothie franchises by acquiring an existing business from another franchisee or from the franchisor; or (iii) convert all of their existing retail operations from another brand to the Planet Smoothie brand.
Training Overview: The franchisor will make a training program available to franchisees and their designated representative after they sign the Franchise Agreement. The classroom portion of the Training Program will be held at KTEC (Kahala Training & Education Center), which is located at the franchisor’s corporate offices in Scottsdale, Arizona, and the in-store portion of the training program will be held at the franchisee’s restaurant location or at such other location(s) as the franchisor may designate in its sole discretion. Currently, training consists of New Owner Training, which is 40 hours of classroom training, and In-Store Training, which is 24 hours of on-the-job training held during the franchisee’s opening week. The franchisor will provide one of its representatives to come to the franchisee’s restaurant during opening week for up to four days at its expense to work with the franchisee and the manager on the grand opening, and on operating and marketing the restaurant. The franchisor may, in the future, hold refresher or additional training programs, conferences and seminars. The franchisee’s attendance at these programs is mandatory.

Territory Granted: The franchise is granted only for the location specified in the Franchise Agreement or a location to be approved by the franchisor. The specific site of the Planet Smoothie restaurant is subject to the franchisor’s approval. The franchisor will not unreasonably withhold its approval of the location. Franchisees will not receive an exclusive territory.

Obligations and Restrictions: While the Franchise Agreement does not specifically require franchisees or their principals to personally participate in the direct operation of the franchise, it is the franchisor’s intention to select as Planet Smoothie franchisees only those who plan to actively participate in the direct operation and daily affairs of the Planet Smoothie restaurant. The franchise must be personally managed with on-premises supervision and directly operated by franchisees or another partner, shareholder or member of the business organization, or a manager who must have successfully completed the training program. If franchisees are individuals, they (and their spouse, if married) must sign the Guaranty of Franchise Agreement in which they (and their spouse, if married) agree to perform, and guarantee, all of the franchisee’s obligations to the franchisor and its affiliates contained in the Franchise Agreement, and if franchisees purchase a corporate restaurant, they (and their spouses, if married) must also sign the Guaranty of Promissory Note and Security Agreement and Guaranty of Sublease in which franchisees (and their spouses, if married) agree to perform, and guarantee, all of the franchisee's obligations to the franchisor and its affiliates contained in the Promissory Note and Security Agreement, and all of the sublessee’s obligations to the franchisor and its affiliates contained in the Sublease. The franchisor requires that the business is solely that of a Planet Smoothie restaurant, and franchisees may not conduct any other business or activity at the site of the restaurant without the franchisor’s prior written approval. For traditional Planet Smoothie franchises, franchisees must offer the full menu prescribed by the franchisor, subject to change from time to time in its sole discretion. Non-traditional Planet Smoothie franchises may offer a more limited menu than the traditional Planet Smoothie franchises, as detailed in the operations manual.

Term of Agreement and Renewal: If franchisees are purchasing a new or existing non-operating Planet Smoothie restaurant, the term is (i) 10 years from the date the restaurant opens to the public if they own the property, or enter into a lease directly with the landlord or other third party, or (ii) the term of the sublease if franchisees enter into a sublease with a Kahala Franchising affiliate excluding any extensions or renewal options. If franchisees are not in default and satisfy certain conditions, they may renew for a single renewal term of five years, with no further right to renew at the end of the renewal term.

Financial Assistance: The franchisor does not offer any direct or indirect financing or financing arrangement, nor will it guaranty a franchisee’s obligations under any note or other obligation, except potentially for the lease for a franchisee’s site or if franchisees purchase a restaurant corporate-owned “as-is” by one of the franchisor’s affiliates, and only in its sole and absolute discretion. If franchisees are currently an active or active reserve member of the U.S. Armed Forces, have been honorably discharged from the U.S. Armed Forces, or if the franchisee is a federally recognized 501(c)(3) organization, they will receive a 20% discount on the initial franchise fee.

Estimated Initial Investment

Name of Fee	Low	High
Initial Franchise Fee	$16,000	$25,000
Lease Review Fee	$0	$2,500
Rent/Security Deposit (for three months)	$6,000	$20,000
Travel and Living Expenses (3 persons) while training, not including salaries, if any, for franchisees and their employees	$3,750	$7,500
Real Estate	Varies
Architectural Fees	$5,000	$21,000
Leasehold Improvements	$6,000	$220,000
Restaurant Equipment, Furniture, Small Wares, Interior Signage and Menu Panels	$14,000	$94,000
Exterior Signage	$9,000	$17,000
Computer Hardware, Software (POS System)	$3,000	$5,000
PCI Compliance Costs	$150	$1,300
Opening Inventory (food and paper)	$2,500	$15,000
Business Insurance	$1,000	$5,000
Miscellaneous Opening Costs	$4,750	$17,200
Grand Opening Marketing	$5,000	$10,000
Depository Account	$3,000	$3,000
Additional Funds – 3 month initial period	$5,000	$15,000
ESTIMATED TOTAL*	$84,150	$478,500

*The estimated initial investment range covers from a non-traditional Planet Smoothie up to a traditional Planet Smoothie. Range does not include real estate costs and/or rent for the business location except for the initial security deposit.

Other Fees

Type of Fee	Amount
Royalty Fee and Surcharge	5% of total biweekly gross sales plus a maximum surcharge of $10 per week.
Advertising Fees	Up to 5% of biweekly gross sales. Currently, 2%.
Additional Persons Training Fee	$1,250 per person ($500 per person for the in-store portion of the training program, and $750 per person for the new owner training portion of the training program).
Additional Training Fee	$300 per person per day.
Annual Meeting Registration Fee	Up to $1,000 plus incidental costs to attend.
Depository Account	$3,000 (Must be replenished on a regular basis.)
Data Fees	Up to $150 per month (Subject to reasonable annual and/or service enhancement increases.)
POS Help Desk Phone Support Maintenance Contract Fee	$55 per month.
Renewal Franchise Fee	50% of the then-current initial franchise fee (not including any potential discounts or reductions).
Transfer Franchise Fee – Traditional Locations	$7,500
Transfer Franchise Fee – Non-Traditional Locations	$5,000
Relocation Fee	$500
Transfer Training Fee	$2,500 for 2 individuals ($500 for each additional individual).
Document Administration Fee	$500
Default Interest	$50 plus interest at 1.5% per month or maximum legal rate, if less.
Late Report Fee	$100 per report.
Sublease Late Charge	5% of the late or unpaid amount plus any late charges and interest incurred under the master lease as a result of the late payment (where applicable).
Collection Costs	All collection costs including reasonable attorneys’ fees.
Non-Sufficient Funds Fee	$50 for each electronic funds transfer returned for non-sufficient funds; $25 for each check or draft returned for non-sufficient funds.
Audit	Cost of audit plus interest at default rate on underpayments or the maximum rate permissible by law.
New Supplier Approval Fee	A charge not to exceed the reasonable cost of the inspection and the actual cost of the test not to exceed $5,000.
Early Termination Damages	The average monthly royalty and advertising fees paid for any consecutive 12 month period within the preceding 48 month period multiplied by the number of months remaining in the term of the Franchise Agreement, and the product is divided by 2.
Non-Participation Fee	$100 per day.
Charitable Contributions	To be determined by the franchisor.
Management Fee	6% of the franchised business’ gross sales (in addition to the royalty fee and advertising fee) plus our direct out-of-pocket costs and expenses.
Attorneys’ Fees and Costs	Will vary under the circumstances.
Indemnification (of the franchisor and/or its affiliates for damages suffered or incurred for the franchisee’s actions or omissions, including amounts paid on the franchisee’s behalf or to cure the franchisee’s breaches under the Franchise Agreement)	Will vary under the circumstances.
Damages for Breach of Non-Compete Obligations Under the Franchise Agreement	Will vary under the circumstances.

The above information has been compiled from the FDD of Planet Smoothie. Year of FDD: 2025.
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