Before joining a franchise, compare start-up and ongoing costs. Then analyze the true value these costs bring to your business. Every dollar you invest during those critical early months of starting a business needs to stretch as far as it can.
|
Franchise Fee
|
2nd Store
|
Initial Investment
|
Royalty
|
Ad Fee
|
|||
| The UPS Store |
29,950
|
19,950
|
171,217-279,878
|
5%
|
3.5%(a)
|
||
| PostNet |
29,900
|
167,025 - 193,250
|
5%
|
2%
|
|||
| Postal Annex |
29,950
|
14,900
|
128,800 - 190,050
|
5%
|
*2%
|
||
| Pak Mail |
29,950
|
129,985 - 164,349
|
5%-3%(b)
|
2%
|
|||
| Aim |
26,900
|
134,700 - 215,000
|
5%
|
*2%
|
|||
| Goin Postal |
24,284
|
|
$300/mo. up to 5%
|
||||
| Postal Connections |
23,900
|
$11,900
|
119,900 - 153,900
|
4%
|
Currently no ad fee
|
||
|
Source: 2008 state filed Franchise Disclosure Documents |
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Notes
a. UPS—Total 3.5% [1% UPS Store Fee & 2.5% Nat'l Ad Fee] Plus $100 - $500 local coop ad contribution
b. Pak Mail—Sliding royalty 5% to 3% lower as store sales increase
c. Goin Postal—Two start up models: Turn-key is comparable to other franchise models. Standard offers manuals, designs, business accounts, and instructions for Do-It-Yourself build out. Equipment & inventory included.
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Some franchise agreements require early funding of fees paid up-front when the initial franchise fee is paid. This can range from $94,000 to $106,199 paid with the initial fee when the franchise agreement is signed. This is prior to identifying your store site and training. It can result in months of financing costs before your business opens.
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Several franchise agreements provide for the franchiser to exclusively sell services, equipment, supplies, and marketing items to their franchisees. Many franchisers report more than 20% of their total revenue coming from re-selling items to their franchisees. We believe this limits operational flexibility and opportunities to use the most efficient business solution. Postal Connections makes its revenue only from the initial franchise fee, new store installation management, and royalties.
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Many of the franchise agreements impound franchisee funds to support opening marketing activities ranging from $1,500 to $7,500. Postal Connections has arranged for vendor subsidies to grand opening activities and no impounds.
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Several franchise agreements require exclusive equipment leasing arrangements franchisees must accept. The franchiser then earns a referral or administrative fee paid by the vendor. Postal Connections has arranged low-cost equipment leases where no “finder fees” are paid instead incentives or wholesale rates are offered to the franchisee.
The information provided on this web site should not be construed as an offer of a franchise. Offers of franchises may only be made by delivery of a Franchise Disclosure Document (prospectus) and in certain states the disclosure document must first have been registered with a state agency that regulates the offers and sales of franchises.
