Wally's Franchise Sytems offers pizza and sub franchises (graphic)

Estimated Initial Investment

Type 'A' Unit (see endnotes below)

Type of Expenditure	Estimated Cost	Method of Payment	When Due	To Whom Payment Made
Initial Franchise Fee¹	$25,000	Certified Funds	Upon execution of Franchise Agreement and 14 calendar days after review of the FDD	Franchisor
Training Expenses²	$1,200 to $3,000	Cash	As Incurred	Vendors
Real Estate³ (Initial lease deposit)	$800 to $22,000	Cash	Upon Signing Lease	Landlord
Build-out Costs⁴	$35,000 to $50,000	Cash	As Incurred before opening	Approved Vendors, Suppliers
Fixtures, Furnishings and Equipment⁵	$20,000 to $35,000	Cash	As Incurred before opening	Approved Vendors
Opening Inventory⁶	$2,000 to $18,000	Cash	Before opening	Approved Vendors
Insurance⁷	$1,000 to $3,500	Cash	Before opening	Insurance carriers
Deposits, License Fees, Prepaid expense, Utilities⁸	$3,000 to $5,000	Cash	As Arranged	Approved Vendors, landlord, utilities, suppliers
Pre-opening Expenses⁹	$3,000 to $6,000	Cash	As Incurred	Vendors, suppliers
G & A Expenses¹⁰	$5,5000 to $15,000	Cash	As Incurred	Approved Vendors, Suppliers
Professional Service Expenses¹¹	$1,000 to $3,000	Cash	As Incurred	Legal, Accounting firms
Additional Funds (for three months of operations)	$10,000 to $25,000	Cash	As Incurred	Franchisor, Approved Vendor, Employees, Suppliers
Total	$107,500 to $190,700
Type 'B' Unit
Type of Expenditure	Estimated Cost	Method of Payment	When Due	To Whom Payment Made
Initial Franchise Fee	$15,000	Certified Funds	Upon execution of Franchise Agreement and 14 calendar days after review of the FDD	Franchisor
Training Expenses	$1,200 to $3,000	Cash	As Incurred	Vendors
Real Estate (Initial lease deposit	$800 to $2,200	Cash	Upon signing lease	Landlord
Build-out Costs	$20,000 to $30,000	Cash	As incurred before opening	Approved vendors, Suppliers
Fixings, Furnishings and Equipment	$15,000 to $30,000	Cash	As incurred before opening	Approved Vendors
Opening Inventory	$2,000 to $18,000	Cash	Before opening	Approved Vendors
Insurance	$500 to $1,500	Cash	Before opening	Insurance carriers
Deposits, License Fees, Prepaid expense, Utilities	$1,200 to $2,000	Cash	As Incurred	Approved Vendors, landlord, utilities, suppliers
Pre-opening Expenses	$3,000 to $6,000	Cash	As Incurred	Vendors, suppliers
G & A Expenses, Sinage	$1,500 to $5,000	Cash	As Incurred	Approved Vendors, Suppliers
Professional Service Expenses	$1,000 to $3,000	Cash	As Incurred	Legal, Accounting firms
Additional Funds (for three months of operations)	$10,000 to $25,000	Cash	As Incurred	Franchisor, Approved Vendor, Employees, Suppliers
TOTAL	$71,200 to $140,700

Endnotes

Notes to Table Above: All payments to Franchise above are non-refundable. No amount in Item 7 will be financed by the Franchisor.

¹The amount of the Franchise Fee depends on the type of franchised Unit. This fee is applied to providing training, site selection, pre-opening assistance, layout and design of your Unit, pre-opening consultation services, use of proprietary system and name. This Fee does not include your costs for the service of a general contractor, or labor costs for actual installation of equipment in the Unit. [top]

²Before you open your business, WALLY’S will provide up to 3 weeks of mandatory training for you and/or your key personnel at WALLY’S headquarters in North Canton, OH or at a site determined by WALLY’S. See Item 11. No separate fee is charged for standard training. You must pay all salaries, or wages, travel, meals and lodging expenses which you and your employees incur in connection with such training which WALLY’S estimates could range from $1,200 - $3,000. You and your employees will not be paid by WALLY’S during training. WALLY’S will schedule training subject to the availability of trainers. Phase II of training may be conducted at the franchisee’s Unit. [top]

³This amount includes the following for Type A Units:

Initial Rent and Deposits $800 to $2,200
In addition, monthly rent tends to range from an annual rate of $12/sf to $16.50/sf for approximately 800-1600 square feet, plus applicable common area charges. [top]

⁴This amount includes the following Type A:

Leasehold improvements	$29,000 - $40,500
Architect/design fees	$ 5,000 - $ 7,000
Survey licenses and fees	$ 1,000 - $ 2,500
	$35,000 - $50,000

Note: Utility hook ups are needed; electrical service (225 to 400 amps is required; and exhaust hood, vent and fire suppression system is sometimes required. Costs for these items typically range from $1,500 to $7,000 each. Costs could increase substantially if new or separate electric lines must be provided to support the Unit. Costs are typically a the lower end of this range if the host facility already has walk-in cooler and freezer storage capacity and necessary sinks and plumbing available for use by the franchised business. Costs may tend toward the high end of the range if additional coolers, freezers, electric lines or other new utility service must be provided. Depending on the location of a “food court” type Unit, you may incur substantial costs for plumbing electrical, ventilation and other leasehold improvements. Additional costs may also be incurred. [top]

⁵In order to assure uniformity, and common standards of trademark usage throughout the System, you must purchase all signage and cabinetry which bear the WALLY’S Marks or otherwise incorporates WALLY’S trade dress from sources expressly authorized in advance by WALLY’S. The estimate includes your cost to hire a competent contractor to install all equipment. The contractor must follow lay-outs and designs approved by WALLY’S to install all equipment, signage and cabinetry; all changes must be approved in advance and in writing by WALLY’S.
A representative of WALLY’S will assist the contractor before and during installation of the Unit. Your cost for a contractor to install the cabinetry could range from approximately $2,500 per Unit to as much as $15,000 for a “food court” type of installation. The estimate also includes your cost to purchase and install WALLY’S electronic reporting and POS system. See Item 11. If the Unit, with all fixtures and equipment is not completely installed before training begins, you must pay WALLY’S expenses, if any, caused by the delay.

This amount included the following for Type A:

Equipment and small wares	$15,000 - $25,000*
POS software, security	$ 5,000 - $10,000
	$20,000 - $35,000

* you may be able to lease the major equipment necessary for your Unit depending on financing arrangements, your credit rating and ability to obtain financing. Before training begins you must install the POS electronic reporting system in accordance with WALLY”S standards and specifications. [top]

⁶You must purchase an initial inventory of food, paper goods and supplies. [top]

⁷You must provide prescribed levels of insurance including product liability, motor vehicle, and contractual liability in an amount of $1,000,000 aggregate single limit coverage (subject to increase), and maintain other insurance required by law or you lease. If you do not already carry acceptable coverage, initial premiums for the required commercial general liability insurance and auto insurance are estimated to be within the ranges above per year. [top]

⁸This amount includes the following for Type A:

Utility Deposit	$ 0 - $1,500
Pre-Opening Payroll	$3,000 - $3,500
	$3,000 - $5,000

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⁹This amount includes for the following Type A:

Grand Opening Advertising	$2,000 - $4,000
Local Advertising	$ 500 - $1,000
Printing	$ 500 -$1,000
	$3,000 - $6,000

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¹⁰This amount includes for the following Type A:

Office Supplies	$2,500 - $8,000
Service Fees	$3,000 - $7,000*
	$5,500 - $15,000

* typical service fees are for pest control, grease trap cleaning, window cleaning, floor waxing, etc. [top]

¹¹Legal and accounting fees to establish your initial corporation and mandatory filing range from $1,000 to $3,000. [top]

WALLY'S FRANCHISE GROUP, INC.
4347 Portage Street, NW • Suite 102 • North Canton, OH 44720
Phone: 330-244-9058
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