0
0

My Cart

Your Shopping Cart is Empty

0
0

My Cart

Your Shopping Cart is Empty

Login
Wishlist
My Cart

Franchise FAQ

Franchise FEE Questions

What factors into determining the cost of the franchise fee?

If financing was the question, we would first look at the market size and determine the appropriate mile radius for that given market.

What are the terms for Franchise fee financing, and what factors are considered?

Once the fee for the market is determined (lets assume $50k total.) We would require half up front and the remaining could be financed over 3 or 6 months depending on the financial strength of the franchisee.

Royalty FEE Questions

When is the Royalty fee due and how much is it?

If royalty was the question, The royalty invoice is sent out on the 15th of every month. We take 5-6% of the top line gross revenue number. For example if revenue was $30k in July we would send the franchisee an invoice for $1500 in August, and so on.

Are there any other fees other than the 5% on revenue?

The 5% royalty fee is the only ongoing mandatory fee we currently have in place. Upon the formation of the franchise agreement there is an attorney doc prep fee.

In the future we would like to incorporate a Marketing fee. To give you clarity we want to ensure the franchisee is constantly marketing in their market. So the idea is to ensure the franchise is spending monthly on marketing, not necessarily a fee that goes to us. (We are still working through this scenario)

Other add on services are optional.

Financing Questions

Can Add On services be financed?

NO

Are there any other fees other than the 5% on revenue?

The 5% royalty fee is the only ongoing mandatory fee we currently have in place. Upon the formation of the franchise agreement there is an attorney doc prep fee.

In the future we would like to incorporate a Marketing fee. To give you clarity we want to ensure the franchisee is constantly marketing in their market. So the idea is to ensure the franchise is spending monthly on marketing, not necessarily a fee that goes to us. (We are still working through this scenario)

Other add on services are optional.

Retail / Warehouse Questions

How many sq ft for a studio do you recommend starting off?

800sqft to $2000. Vertical space is a big plus. Having vertical space is almost as important as

the total square footage itself. Warehouse, loft, or flex space with a mezzanine or loft level is

ideal.

Does the location matter most? Or is affordability more important when starting out?

This depends totally on the market. For example, if your market has a heavy tourist population as well as major conventions and events, finding a space near the heat of those attractions would be the smart choice even if it was more expensive.

With that being said, affordability does matter. We recommend looking for space near the action or the center of your market population but in an “upcoming” or transitioning part of town. Your proximity will lead to lower delivery fees for your customers, which makes them more likely to order.

What to do if you live in a sub market far away from the city center of your major market hub?

You must keep in mind that people are very visual, and businesses and customers looking to hire you will look at your location on Google maps in relation to their business or destination for their event when making the decision. A good solution could be to get an affordable space, but get a PO Box in a popular central location. The only tricky thing with that is delivery fees would have to be based on the PO Box address not the actual studio location.

Payroll & Healthcare Questions

Do my employees have to get the same healthcare benefits and must we use the same payroll system or is that by location?

We use Insperity, however each franchisee can choose their own. However, it is very important to have a professional payroll system in place that can allow employees to easily get payroll and w2 information.

As for health benefits, its not mandatory, but something each franchisee should keep in mind when selecting a payroll provider.

Balloon Inventory Questions

Any special pricing on inventory?

We require the franchisees to buy 90% of materials through us. We simply charge 10% over our actual costs. Since we buy so much product our pricing will be at a lower cost basis than our franchisee would be able to find on their own.Our pricing in most cases is lower than buying online or from your local distributor.

Is it a requirement to use BT Corp to fulfill inventory orders?

Yes. But there are exceptions. Last minute deals, orders that we simply can't get to you in time, or products that we don't have in stock. In those situations our franchisees will be able to buy directly from vendors of their choosing. With that said it will be important for the franchisee to have a wholesale account with a nearby balloon distributor as a backup.

Training & Support Questions

What support can a Franchise expect from BT Corp?

We will answer any question at any time in regards to running your business. We will guide you step by step.

We will be hand in hand when:

Setting up your payroll system

Scheduling system (Asana)

Junior will personally help you interview staffers if you request

Jessi and staff will personally training your initial + Fabrication staff for 3 full days

The only limit will be time dedicated to training your staff after your initial 5 day training and first month or two of operational support. We limit this only to ensure the franchisee is relying on themselves and their staff to problem solve daily instead of corporate. However, there will always be a level of support from BT Corporate.

Revenue Projection Questions

What's your estimate on a timeline to break even?

This is a 2 part answer and each market is so different, but I will share our goals.

In terms of breaking even via gross revenue, We believe a market should break even in less than 120 days.

In terms of net profit, it is much harder to judge. Each franchisee can go as aggressive or conservative as they choose as long as predetermined revenue markers are being met. In the agreement most markets will have a monthly gross minimum of $10k a month in revenue or so.

At the moment it seems most markets are growing on average at a steady $5k per month. For example first month would be $20k, second would be $25k, third would be $30k.

With That said, So much depends on the franchise operator... The numbers will stabilize overtime, but with demand growing every day and not deviating from the BT model I'm confident most markets will see $40k+ months on average.

With those kinds of numbers net profit I would assume to be $5 -$10k per month. With that said if an operator wants to dominate. Instead of pocketing profits you could buy a second van and possibly save up to buy another market.

Projected revenue/profit/income?

So here what I would expect revenues to be for an average franchisee, in a large market.

1 studio and a 60% focus on Corporate vs 40% non Corporate business.

Year 1 $400-500k annual revenue, with monthly averages of $40k+ Year 1 Operating costs would be around $250k - $350k. Rents, Staff, Transportation, Materials, Marketing etc.

In addition to the owner being a w2 employee of the company (you). The distributions throughout the year should be in the $50k range.

Now with that said, YOU Should beat those estimated numbers. But given the new market, new operator, Covid, and competition, all of those could factor in.

Marketing Questions

Does a website come with that initial franchise fee?

The franchisee is responsible for securing buying the domain and paying for hosting related costs for the website in perpetuity. However The basic design and development of the site will be included as part of your Market brand package. See the BT Tulsa Site to get an idea.

Is it possible to have a grace period for that social media add-on piece starting off to cut some cost?

Ish… As for the launch, the site, Social media brand standard and such will have to be done up front. Paying to have our team run and manage your social media accounts (add on) could be done at a later time.