Understanding the startup costs of a franchise are perhaps the most crucial element in deciding whether or not to pursue a career in garment franchise ownership. There are several costs to take into account, including the franchise fee, royalty payments, and shared development and advertising funds. At Apricot Lane, we’re big believers in the idea that a franchise is an investment, not an expense, and that our thriving, profitable industry offsets the cost of investing in one of our stores. If you’re considering starting a garment franchise, here’s what you should know about the financial investment.
Startup Costs of a Garment Franchise
The first thing you should know about an investment in our garment franchise is what is required for startup costs. That’s why we’ve tried to outline as clearly as possible where your money is going, and what your investment gets you. Our initial franchise fee is $34,500, with a bi-monthly royalty payment of 5.5% gross revenue, and an advertising development fund contribution of 1%. This contribution is pooled among all our franchisees, and is earmarked for your advertising and marketing needs. We estimate that the typical total investment made by our franchisees hovers around $225,000.To afford the investment, you might explore financing. To finance an Apricot Lane franchise, you’ll need a minimum of $75,000 in cash or liquid assets, as well as the collateral to apply against the remainder of a loan. Although we do not provide in-house financing, we are happy to refer you to one of our preferred lenders.
To afford the investment, you might explore financing. To finance an Apricot Lane franchise, you’ll need a minimum of $75,000 in cash or liquid assets, as well as the collateral to apply against the remainder of a loan. Although we do not provide in-house financing, we are happy to refer you to one of our preferred lenders.
It’s a great time to join our team, with many opportunities available across the U.S. We make choosing a location easy, and even physically meet you in your market to help you choose your location. Another option, which makes for a speedy opening, is purchasing a turnkey location. You should be prepared to meet the minimum financial requirements based on the purchase and sale agreement for that location. In order to obtain a full package on the resale you will be asked to complete an application, a non-disclosure agreement, and review our Franchise Disclosure Document package.
It can be daunting looking at the investment costs associated with owning a garment franchise, but considering the strength of our industry, we believe it’s a strong investment opportunity. The clothing industry is among the strongest and most consistent in the world, with the industry expected to grow by as much as 17.2% by 2020.
We are also fortunate to be well-positioned within the fast fashion niche. Although the fashion industry as a whole has seen significant growth, the fast fashion industry, in particular, has grown 21% over the past three years, and is expected to grow an additional 5.9% per year for the next three.
Garment franchises like Apricot Lane understand that consumers these days want the hottest clothes as soon as they appear on the runway, so it’s no surprise that our space is growing incredibly quick, especially compared to the luxury market. Prospective franchisees should feel confident in the strength of the industry they are entering, and in the potential for that industry to continue to grow.
If investing in an Apricot Lane franchise sounds like the right career move for you, reach out to us today for more information.