Moe’s Southwest Grill Franchise Cost & Fees

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Description

Year Business Began: 2000

Franchising Since: 2001

Headquarters: Atlanta, Georgia

Estimated Number of Units: 680

Franchise Description: The franchisor is Moe’s Franchisor SPV LLC. The franchise offered is a Moe’s Southwest Grill Restaurant. Moe’s Southwest Grill Restaurants are fast casual restaurants featuring fresh-mex and southwestern food products. Franchisees conduct business under the service mark “Moe’s Southwest Grill” and any other identifying marks and symbols that are used now, or are later developed by the franchisor, and uses the franchisor’s unique system for the establishment, development and operation of a Restaurant. Training Overview: Franchisees must have two full-time Managers attend the initial management training program in Atlanta, Georgia. The Management Training Program will include: (i) approximately 2 ½ weeks of in-restaurant training (2 days off included) at one of the franchisor’s certified training locations in Atlanta, GA (the Management Training Programs for Captive Audience Locations); (ii) assigned online training pre-work (approximately 5 hours); and (iii) assigned online training post-work (hours will be determined based on title and responsibility in the new restaurant). Neither the franchisees nor Managers may attend the Management Training Program until the Restaurant is under construction and the franchisee has provided a signed Site Agreement along with evidence of the insurance that is required under the Franchise Agreement. In addition, training must be scheduled within 3 months of the scheduled opening date of the Restaurant. The franchisor currently provides, though it is not obligated to do so, Continued Professional Development programs (CPD) for Roadie, management, and multi-unit employees. The franchisor may require Managers, Primary Contact, and other personnel it designates to attend CPD training, which may be held online, via teleconference, or in person at locations that it specifies, which may require the trainees to travel. The franchisor also may require franchisees and the equity owners and employees it specifies to complete refresher and/or additional training when the franchisor thinks it is appropriate based on the franchisee’s operations. Refresher courses and additional training may take the form of web-based training modules, webinars, or on-site training. The franchisor may periodically conduct a conference, convention, or program.Territory Granted: The restaurant may only be operated at the Accepted Location. Franchisees may receive a territory with limited protected rights (Area of Protection). The size and scope of the Area of Protection will be in the Franchise Agreement and will be determined on a case-by-case basis. The factors the franchisor considers in determining the size of an Area of Protection include current and projected market demand, demographics and population, median household income, presence of other businesses, location of competitors, traffic patterns, access and visibility, location of other restaurants, the franchisor’s future development plans and other market conditions. However, there is no minimum Area of Protection for a restaurant, if the franchisor grants franchisees one. If the franchisee is not granted an Area of Protection, the franchisee will not receive a protected territory.Obligations and Restrictions: Franchisees are required to devote their best efforts to the proper and effective operation of the restaurant. If franchisees are an individual, they must either serve as a Manager or designate a Manager. If franchisees are an Entity, the entity must designate a Manager, who may also be the Primary Contact. The Restaurant must retain two Certified Managers on staff during the first 90 days of operation and must have one Certified Manager on staff thereafter. Franchisees may offer in the restaurant to customers only the Approved Products that the franchisor has approved in writing. Franchisees must produce and sell all Approved Products the franchisor specifies, including all menu items and other products and services that the franchisor requires franchisees to sell, as stated in the Manuals or otherwise, which are all part of the System.Term of Agreement and Renewal: The length of the initial franchise term is 20 years. One 20-year renewal term if franchisees comply with the franchisor’s renewal requirements.Financial Assistance: The franchisor does not offer financing for trade fixtures, opening inventory, or any other purpose. The franchisor may refer franchisees to leasing or financing companies not affiliated with it. The franchisor and its affiliates receive no fees or other financial benefits from any lender for franchisees’ financing. Currently, the franchisor will not guarantee a franchisee’s note, lease, or obligation, for any lender, or any other person or entity. The franchisor may engage an advisor who will provide consulting services to franchisees to assist them with securing financing and it pays the advisor for this assistance to franchisees. The franchisor participates in the SBA’s Franchise Registry Program. The franchisor may modify the Franchise Agreement, if necessary, to comply with SBA requirements for the franchisee to participate in certain SBA loan programs. Investment Tables: Estimated Initial Investment Name of Fee Low High Initial Franchise Fee $30,000 $30,000 Rent $4,500 $20,000 Leasehold Improvements $161,035 $371,000 Millwork $22,600 $35,000 Equipment Package $92,000 $143,000 Furniture $17,000 $24,000 Smallwares $10,000 $17,000 Menu Board, Graphics, Interior Signage $4,200 $18,312 Exterior Signage $5,300 $55,000 Computer Hardware/Software, Training $12,600 $23,700 TV, Music $1,500 $5,200 Drink Dispenser $0 $0 Architect $8,300 $55,000 Grand Opening Marketing $25,000 $60,000 Insurance $3,500 $15,000 Misc. Opening Costs $10,000 $25,000 Security Deposits $4,500 $30,000 Travel and Living Expenses while Training $5,000 $10,000 Opening Inventory $4,000 $10,000 Additional Funds – 3 Months $25,000 $50,000 Estimated Total Investment (excluding real estate) $446,035 $997,212 Other Fees Type of Fee Amount Royalty Fee 5% of Net Sales. Advertising Contribution 2% of Net sales. Advertising Cooperative Contribution An amount set by the franchisee’s Advertising Cooperative. Local Marketing Obligation Each calendar quarter, the franchisee must spend not less than 2% of Net Sales on local market advertising . Promotions Costs to purchase, lease and install all materials necessary for promotional campaigns, including counter cards, posters, banners, signs, photographs, give-away items and gift cards. The franchisor may charge the franchisee costs plus a reasonable administrative fee. EFT NSF Fee The franchisors out-of-pocket costs and an administrative fee. Interest 1.5% per month or maximum legal interest rate. Late Fee for reports, financial statements or tax returns $100 per day. Taxes The franchisor’s cost. Subsequent Trainee Initial Training Fee Currently, up to $500 per trainee. On-Site Training and Assistance A reasonable fee, currently, $50 per hour per trainer plus trainers’ travel and living expenses. Additional Support/Consulting Fee A reasonable fee, currently, $500 per day, plus travel and living expenses. Conference/Program Fee A reasonable fee, which will vary by program. Training Cancellation Fee The franchisor’s out-of-pocket costs. Electronic Learning Management System Amount of fees. The franchisor estimates the cost will be $500 to $750 annually Supplier/Product Evaluation Fee The greater of $2,500 or the actual cost of the supplier/product evaluation process. Rent Will vary based on location and other factors; the estimated rent will range $4,500 – $20,000 per month. Relocation Extension Fee Another Initial Franchise Fee of $1,500 per year of extension on term Lease Renewal Fee The then-current fee. Currently, $2,000 Lease Documentation Fee $500 per month (or partial month) until delivered Transfer Fee 50% of the then-current Initial Franchise Fee if it is a Control Transfer; if it is a transfer to a related party or that is a non-Control Transfer, 10% of the then-current Initial Franchise Fee Renewal Fee 10% of the then-current Initial Franchise Fee. Computer Systems Fee A reasonable fee, which will vary on the services provided. POS System Support Fee Currently, estimated to be between $25 and $250 per month depending on the level of support the franchisee selects Back Office and Polling Software Fee Approximately $126 per month Credit Card Fees Equipment costs and set up fees estimated to be up to $1,000 per terminal. Transaction fees estimated to be from 2.5% to 5.0% of transaction amounts. Other fees may apply depending on the vendor used for credit card processing. PCI Compliance Service Fee Equipment cost and setup fees are estimated to be up to $90 per month. Professional installation fees are estimated to be up to $500, depending on the vendor and plan the franchisee selects. Gift Card and Loyalty Card Fees Amount of fees. Purchasing Program Fee Reasonable membership fees assessed by the Purchasing Program. Supply Chain Fee Currently, $0.25 – $0.35 per case purchased through certain Appointed Distributors. Ordering Support FeeA reasonable fee, which will vary based on the services provided Development Deadline Extension Fee $2,500 per missed deadline. Non-compliance FeeCurrently, $25 to $500 for a single default, but may vary based on the severity of defaults and repetition of defaults Failure to Comply with Standards or Law Fee Up to a $5,000 fee plus the franchisor’s reasonable expenses connected with any inspection, examination or analysis of product. Repeated Inspection Fee Cost of inspection. Restrictive Covenant Violation Fee $2,500 for an hourly employee, $5,000 for an assistant manager, $7,500 for a manager or general manager, and $10,000 for a corporate employee. Audit Cost of audit. Liquidated Damages The average monthly amount of Royalty that the franchisee owed the franchisor during the past 36 months times the lesser of the remainder of term of the Franchise Agreement or 36 months. Appraiser’s Fee 50% of appraiser’s fee. Indemnification of Franchisor The franchisor’s cost. Attorneys’ Fees The franchisor’s cost. Reinstatement Fee 10% of the amount of the then-current Initial Franchise Fee, plus Royalty Fees that would have been payable in period between termination and reinstatement. De-Identification Fee The franchisor’s actual costs, plus interest and an administrative fee equal to 15% of the franchisor’s actual costs. The above information has been taken from the FDD of Moe’s Southwest Grill. Year of FDD: 2018Franchise Direct’s Disclaimer

 

Other Fees
Type of Fee Amount
Royalty Fee 5% of Net Sales.
Advertising Contribution 2% of Net sales.
Advertising Cooperative Contribution An amount set by the franchisee’s Advertising Cooperative.
Local Marketing Obligation Each calendar quarter, the franchisee must spend not less than 2% of Net Sales on local market advertising .
Promotions Costs to purchase, lease and install all materials necessary for promotional campaigns, including counter cards, posters, banners, signs, photographs, give-away items and gift cards. The franchisor may charge the franchisee costs plus a reasonable administrative fee.
EFT NSF Fee The franchisors out-of-pocket costs and an administrative fee.
Interest 1.5% per month or maximum legal interest rate.
Late Fee for reports, financial statements or tax returns $100 per day.
Taxes The franchisor’s cost.
Subsequent Trainee Initial Training Fee Currently, up to $500 per trainee.
On-Site Training and Assistance A reasonable fee, currently, $50 per hour per trainer plus trainers’ travel and living expenses.
Additional Support/Consulting Fee A reasonable fee, currently, $500 per day, plus travel and living expenses.
Conference/Program Fee A reasonable fee, which will vary by program.
Training Cancellation Fee The franchisor’s out-of-pocket costs.
Electronic Learning Management System Amount of fees. The franchisor estimates the cost will be $500 to $750 annually
Supplier/Product Evaluation Fee The greater of $2,500 or the actual cost of the supplier/product evaluation process.
Rent Will vary based on location and other factors; the estimated rent will range $4,500 – $20,000 per month.
Relocation Extension Fee Another Initial Franchise Fee of $1,500 per year of extension on term
Lease Renewal Fee The then-current fee. Currently, $2,000
Lease Documentation Fee $500 per month (or partial month) until delivered
Transfer Fee 50% of the then-current Initial Franchise Fee if it is a Control Transfer; if it is a transfer to a related party or that is a non-Control Transfer, 10% of the then-current Initial Franchise Fee
Renewal Fee 10% of the then-current Initial Franchise Fee.
Computer Systems Fee A reasonable fee, which will vary on the services provided.
POS System Support Fee Currently, estimated to be between $25 and $250 per month depending on the level of support the franchisee selects
Back Office and Polling Software Fee Approximately $126 per month
Credit Card Fees Equipment costs and set up fees estimated to be up to $1,000 per terminal. Transaction fees estimated to be from 2.5% to 5.0% of transaction amounts. Other fees may apply depending on the vendor used for credit card processing.
PCI Compliance Service Fee Equipment cost and setup fees are estimated to be up to $90 per month. Professional installation fees are estimated to be up to $500, depending on the vendor and plan the franchisee selects.
Gift Card and Loyalty Card Fees Amount of fees.
Purchasing Program Fee Reasonable membership fees assessed by the Purchasing Program.
Supply Chain Fee Currently, $0.25 – $0.35 per case purchased through certain Appointed Distributors.
Ordering Support Fee A reasonable fee, which will vary based on the services provided
Development Deadline Extension Fee $2,500 per missed deadline.
Non-compliance Fee Currently, $25 to $500 for a single default, but may vary based on the severity of defaults and repetition of defaults
Failure to Comply with Standards or Law Fee Up to a $5,000 fee plus the franchisor’s reasonable expenses connected with any inspection, examination or analysis of product.
Repeated Inspection Fee Cost of inspection.
Restrictive Covenant Violation Fee $2,500 for an hourly employee, $5,000 for an assistant manager, $7,500 for a manager or general manager, and $10,000 for a corporate employee.
Audit Cost of audit.
Liquidated Damages The average monthly amount of Royalty that the franchisee owed the franchisor during the past 36 months times the lesser of the remainder of term of the Franchise Agreement or 36 months.
Appraiser’s Fee 50% of appraiser’s fee.
Indemnification of Franchisor The franchisor’s cost.
Attorneys’ Fees The franchisor’s cost.
Reinstatement Fee 10% of the amount of the then-current Initial Franchise Fee, plus Royalty Fees that would have been payable in period between termination and reinstatement.
De-Identification Fee The franchisor’s actual costs, plus interest and an administrative fee equal to 15% of the franchisor’s actual costs.