In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:

Section I – Estimated initial investment (franchise costs) for a Candy Cloud franchise, based on Item 7 of the company’s 2024 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Candy Cloud franchise, based on Items 5 and 6 of the company’s 2024 FDD

Section III – Number of franchised and company-owned Candy Cloud outlets at the start of the year and the end of the year for 2021, 2022, and 2023, based on Item 20 of the company’s 2024 FDD

Section IV – News updates on the Candy Cloud franchise opportunity

Section V – Presentation and analysis of Candy Cloud’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2024 FDD, including information on the:

• September 1, 2022 to August 31, 2023 gross revenue, cost of goods sold, gross profit, operating expenses, franchisee fees, and net income for the one affiliate-owned Candy Cloud outlet that was open and operating during the reporting period

Section VI – Key ratios, comparables, computations, and analyses for the Candy Cloud franchise opportunity (exclusive content for Platinum subscribers)

Section I – Candy Cloud Franchise Costs

• Candy Cloud franchise costs, based on Item 7 of the company’s 2024 FDD:

• Initial Franchise Fee:  $40,000
• Leasehold Improvements:  $150,000 to $275,000
• Lease Deposits:  $4,000 to $20,000
• Rent (3 months):  $8,000 to $30,000
• Utilities (3 months):  $2,100 to $2,700
• Utility Deposit:  $0 to $900
• Architect and Engineer Fees:  $7,000 to $15,000
• Design Service:  $2,500 to $3,000
• Furniture and Fixtures:  $3,000 to $15,000
• Equipment:  $100,000 to $135,000
• Computer Equipment:  $10,000 to $13,000
• Software (3 months):  $1,800
• Internal System Fee (3 months):  $600
• Miscellaneous Equipment and Supplies:  $3,500 to $4,000
• Accounting Service (3 months):  $1,000 to $1,500
• Signage:  $8,000 to $20,000
• Smallware:  $4,000 to $6,000
• Initial Inventory:  $10,000 to $15,000
• Insurance:  $2,100 to $2,850
• Your Training Expenses (transportation, lodging, and meals):  $5,000 to $7,000
• Grand Opening Marketing Campaign:  $8,000
• Professional Fees:  $3,000 to $6,000
• Business Permits and Licenses:  $500 to $2,000
• Additional Funds (3 months):  $15,000 to $20,000
• Total Estimated Candy Cloud Franchise Costs:  $389,100 to $644,350

Section II – Candy Cloud’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Candy Cloud’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2024 FDD:

• Initial Franchise Fee:  $40,000
• Continuing Royalty Fee:  6% of weekly Gross Revenue
• Brand Fund Contribution:  up to 4% of weekly Gross Revenue. The current Brand Fund Contribution is 2% of weekly Gross Revenue.
• Required Minimum Expenditure for Local Marketing and Advertising:  no minimum current required spend after the initial $8,000 grand opening marketing campaign is paid to Candy Cloud; maximum of 2% of the average Gross Revenue per territory per month annually

Section III – Number of Franchised and Company-Owned Candy Cloud Outlets

Franchised

2021

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2022

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2023

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

Company-Owned

2021

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  1

2022

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  1
• Net Change:  +1

2023

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

*Company-owned outlets are operated by affiliated entities.

Section IV – News Updates on the Candy Cloud Franchise

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Candy Cloud Franchise (Item 19, 2024 FDD)

• Candy Cloud has one outlet that is owned and operated by an affiliate. This unit has been in operation since March 2022 in Rockford, Illinois.

• The below historical financial performance representations include the Royalty and Brand Fund Contribution that a franchisee-operated outlet would be expected to pay. Candy Cloud has included the financial representations for this outlet from September 1, 2022 through August 31, 2023.

• The reasonable basis for inclusion of this Financial Performance Representation is the affiliate-owned outlet is similar to the franchise being offered under the Disclosure Document in terms of operations and product offerings. There are no material financial or operational characteristics of the below affiliate-owned outlet that are reasonably anticipated to differ materially from future franchise outlet operations.

• “Gross Revenue” includes all revenues and income from any source derived or received by the affiliate-owned outlet, including but not limited to, any and all other revenues received using Candy Cloud’s methods, operations, and/or trade secrets whether received in cash, in services, in kind, from barter and/or exchange, on credit (whether or not payment is actually received), or otherwise.

• Some outlets have earned these amounts. Your individual results may differ. There is no assurance you will earn as much.

Candy Cloud Rockford (September 1, 2022 through August 31, 2023)

Gross Revenue:  $1,604,285.00 (100.0%)

Cost of Goods Sold

• Cost of Goods Sold:  $465,416.02 (29.0%)
• Square Fees:  $47,464.20 (3.0%)
• Wages & Salaries:  $412,035.31 (25.7%)
• Total Cost of Goods Sold:  $924,915.53 (57.7%)

Gross Profit:  $679,369.47 (42.3%)

Operating Expenses

• Business License & Fees:  $2,007.00 (0.1%)
• Dues & Subscriptions:  $996.14 (0.1%)
• Insurance:  $3,115.64 (0.2%)
• Office Expenses:  $12,520.22 (0.8%)
• Payroll Tax Expense:  $47,299.84 (2.9%)
• Professional Fees:  $28,914.21 (1.8%)
• Rent Expense:  $40,565.06 (2.5%)
• Repairs & Maintenance:  $10,525.27 (0.7%)
• Small Equipment:  $8,835.42 (0.6%)
• Utilities:  $24,790.07 (1.5%)
• Total Operating Expenses:  $179,568.87 (11.2%)

Operating Income:  $499,800.60 (31.2%)

Franchisee Fees

• Assumed Franchisee Royalty Fee (6%):  $96,257.10 (6.0%)
• Marketing Fund Fee (2%):  $32,085.70 (2.0%)

Net Income:  $371,457.80 (23.2%)

Section VI – Candy Cloud Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️