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Franchise FAQ
1. Q. How much will I need to invest?
A. The estimated cost of a 505 Imports franchise will be approximately $161,900 to $230,500 and varies upon location.
2. Q. What does the franchise system include?
A. Owning and operating an assigned 505 Imports franchise, use of brand name, trademarks, operational systems, and décor, as well as access to our exclusive line of furniture and accessories. Additionally, you will receive support in these specific areas:
- Prototypical architectural plans and assistance in the development of your specific construction plans.
- Specifications for fixtures, furniture, equipment, and leasehold improvements.
- Assistance in site selection.
- Corporate training.
- Ongoing support from the 505 Imports operations team.
- Full list of 505 Imports approved suppliers for all product lines.
- Operating manuals, policies, procedures, and business management systems.
3. Q. How much is the franchise fee for a 505 Imports franchise?
A. $35,000 for your first location, $30,000 for your second location, and $25,000 for your third and subsequent locations.
4. Q. Does 505 Imports offer multi-unit development opportunities?
A. Yes. 505 Imports is actively seeking franchisees who will build multiple locations over time. To secure the rights to open multiple units in a specific trade area, you must pay an area development fee equal to $15,000 multiplied by the number of stores to be developed. This $15,000 deposit is then credited toward the franchise fee for each store developed. For example, if you purchased the right to develop three units in a specific trade area, you would be required to pay $45,000 ($15,000 x 3) as the deposit on three stores, plus $20,000 as the balance of the franchise fee for the first unit, for a total of $65,000. You would be obligated to pay the balance on each franchisee fee, or $15,000, for the second store and $10,000 for the third store, when leases for these locations are executed.
5. Q. How much is the on-going royalty fee?
A. 3% of total gross sales less sales tax.
6. Q. How much is the advertising and promotional obligation?
A. 7% of total gross sales less sales tax. We allocate this 7% advertising and promotional obligation as follows: 2% to the 505 Imports system advertising fund and 5% for local advertising.
7. Q. How is the site selected for my store?
A. 505 Imports will provide Real Estate assistance and must approve all 505 Imports store locations. It is the franchisees responsibility to present potential sites for approval to 505 Imports. 505 Imports will provide a Site Approval Package to assist each franchisee in this regard.
8. Q. Is there any experience necessary to own a 505 Imports franchise?
A. Yes, but not necessarily in furniture. 505 Imports actively searches for candidates with strong business and leadership skills.
9. Q. Do I need to be involved in the day-to-day operation of my franchise?
A. At least one owner or a designated general manager must be involved on a full-time basis and must be responsible for the day-to-day operations and management. At least one owner must assume responsibility for general oversight and management of each store.
10. Q. How will I know if I have the necessary finances?
A. You must show a net worth in excess of $500,000, with $100,000 available in liquid assets for each proposed store to be developed.
11. Q. How long is the term of a 505 Imports franchise agreement?
A. The franchise agreement term is ten (10) years, renewable for two additional periods of five (5) years.
12. Q. I am interested in a 505 Imports franchise. What do I do next?
A. For more information, and to help us serve you efficiently, please complete our online application and you will be contacted by a 505 Imports franchise representative. Visit the application page. |
