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

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

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

Section III – Number of franchised and company-owned Tippi Toes 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 Tippi Toes franchise opportunity

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

• 2023, 2022, and 2021 average, median, high, and low revenue for the Tippi Toes franchise outlets that generated sales for the full applicable 12-month period

• 2023, 2022, and 2021 average, median, high, and low student enrollment per month for the Tippi Toes franchise outlets that generated sales for the full applicable 12-month period

• 2023 average annual number of student tuitions billed, revenue, cost of goods sold, gross profit, SG&A expenses, imputed Royalty and Brand Fund, and net income/owner profit for the 15 Tippi Toes franchise outlets that generated sales for the full applicable 12-month period and provided Tippi Toes with their summary income statements for the 2023 calendar year

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

Section I – Tippi Toes Franchise Costs

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

• Initial Franchise Fee:  $49,500
• Uniforms:  $100 to $500
• Training Travel Costs and Expenses:  $1,500 to $3,000
• Insurance:  $1,000 to $1,500
• Real Estate and Improvements, Furniture, and Fixtures:  $0
• Miscellaneous Opening Costs, Deposits, Licenses, and Professional Fees:  $1,000 to $2,500
• Equipment and Computer Systems:  $2,000 to $3,500
• Rent:  $0 to $3,000
• Additional Funds (to cover working capital needs for a startup period of 3 months):  $12,000 to $20,000
• Total Estimated Tippi Toes Franchise Costs:  $67,100 to $83,500

Section II – Tippi Toes’ Initial Franchise Fee, Royalty Fee, and Marketing Fee

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

• Initial Franchise Fee:  $49,500
• Royalties:  an amount equal to the greater of 7% of your Gross Sales or the Minimum Royalty (Months 1-12: none; Months 13-24: $500 per month per territory; Months 25+: $1,000 per month per territory)
• Brand Fund Contribution:  currently 1% of Gross Sales but can be increased to 2% during your term with advanced notice
• Marketing Cooperative Fund:  currently $0, but if implemented then up to 2% of your Gross Sales at Tippi Toes’ option

Section III – Number of Franchised and Company-Owned Tippi Toes Outlets

Franchised

2021

• Outlets at the Start of the Year:  28
• Outlets at the End of the Year:  32
• Net Change:  +4

2022

• Outlets at the Start of the Year:  32
• Outlets at the End of the Year:  33
• Net Change:  +1

2023

• Outlets at the Start of the Year:  33
• Outlets at the End of the Year:  47
• Net Change:  +14

Company-Owned

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:  1
• Net Change:  +1

2023

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

Section IV – News Updates on the Tippi Toes Franchise

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

• The below tables represents certain historical sales data achieved by Tippi Toes’ franchisees. Your location will offer the same products and services as these locations offer.

• As of December 31, 2021, Tippi Toes had 28 total franchised outlets in operation. For Parts 1 and 2, in 2021, Tippi Toes excluded 10 outlets due to one or more of the following reasons: 7 outlets did not generate sales for the full 12-month period, 1 outlet transferred ownership, and 2 outlets are owned by relatives of the principals of the franchisor.

• As of December 31, 2022, Tippi Toes had 31 total franchised outlets in operation. For Parts 1 and 2, in 2022, Tippi Toes excluded 10 outlets due to one or more of the following reasons: 5 outlets did not generate sales for the full 12-month period, 3 outlets transferred ownership, and 2 outlets are owned by relatives of the principals of the franchisor.

• As of December 31, 2023, Tippi Toes had 47 total franchised outlets in operation. For Parts 1 and 2, in 2023, Tippi Toes excluded 26 outlets due to one or more of the following reasons: 21 outlets did not generate sales for the full 12-month period, 3 outlets transferred ownership, 2 outlets are owned by relatives of the principals of the franchisor.

Part 1 – Tippi Toes Reporting Franchisee Revenue Per Franchise Outlet

• To qualify to be included in this chart, Franchise Outlets must have reported revenue in all 12 months for each respective year.

2021

• High Revenue Per Franchise Outlet:  $328,025
• Low Revenue Per Franchise Outlet:  $45,680
• Median Revenue Per Franchise Outlet:  $91,031
• Average Revenue Per Franchise Outlet:  $116,700
• Number of Franchise Outlets:  18
• Number and Percentage of Franchise Outlets Exceeding Average:  8 (44%)

2022

• High Revenue Per Franchise Outlet:  $444,349
• Low Revenue Per Franchise Outlet:  $43,047
• Median Revenue Per Franchise Outlet:  $205,730
• Average Revenue Per Franchise Outlet:  $200,643
• Number of Franchise Outlets:  21
• Number and Percentage of Franchise Outlets Exceeding Average:  11 (52%)

2023

• High Revenue Per Franchise Outlet:  $530,329
• Low Revenue Per Franchise Outlet:  $45,045
• Median Revenue Per Franchise Outlet:  $285,684
• Average Revenue Per Franchise Outlet:  $258,682
• Number of Franchise Outlets:  21
• Number and Percentage of Franchise Outlets Exceeding Average:  13 (62%)

Part 2 – Total Student Enrollment Per Month Per Franchise Outlet

• To qualify to be included in this chart, Franchise Outlets must have reported revenue in all 12 months for each respective year.

2021

• High Student Enrollment Per Month Per Franchise Outlet:  498
• Low Student Enrollment Per Month Per Franchise Outlet:  34
• Median Student Enrollment Per Month Per Franchise Outlet:  64
• Average Student Enrollment Per Month Per Franchise Outlet:  74
• Number of Franchise Outlets:  18
• Number and Percentage of Franchise Outlets Exceeding Average:  14 (78%)

2022

• High Student Enrollment Per Month Per Franchise Outlet:  575
• Low Student Enrollment Per Month Per Franchise Outlet:  41
• Median Student Enrollment Per Month Per Franchise Outlet:  163
• Average Student Enrollment Per Month Per Franchise Outlet:  213
• Number of Franchise Outlets:  21
• Number and Percentage of Franchise Outlets Exceeding Average:  15 (72%)

2023

• High Student Enrollment Per Month Per Franchise Outlet:  667
• Low Student Enrollment Per Month Per Franchise Outlet:  80
• Median Student Enrollment Per Month Per Franchise Outlet:  236
• Average Student Enrollment Per Month Per Franchise Outlet:  302
• Number of Franchise Outlets:  21
• Number and Percentage of Franchise Outlets Exceeding Average:  18 (86%)

Part 3 – 2023 Profit and Loss Statement

• The following Profit and Loss statements represents the performance of 15 franchise outlets and does not represent all Tippi Toes locations.

• Fourteen Profit and Loss statements have been excluded due to one or more of the following reasons:

• 1) Outlets which are company or relative owned.
• 2) Outlets not in operation all 12 months.
• 3) Outlets which have changed ownership.
• 4) Outlets with incomplete or unreliable financial reporting.

Average

Revenue

Annual Student Tuition Billed:  3,228

• Costume Income:  $12,132 (4.3%)
• Registration:  $8,160 (2.9%)
• Tuition:  $242,326 (85.1%)
• Special Events and Recitals:  $22,016 (7.7%)
• Total Revenue:  $284,635 (100.0%)

Cost of Goods Sold

• Teacher Wages:  $75,584 (26.6%)
• Rent:  $21,039 (7.4%)
• Supplies and Materials:  $1,902 (0.7%)
• Recital Expenses:  $27,943 (9.8%)
• Merchant Fees:  $2,174 (0.8%)
• Retail Merchandise:  $3,176 (1.1%)
• Total Cost of Goods Sold:  $131,818 (46.3%)

Gross Profit:  $152,817 (53.70%)

Selling, General, and Administrative Expenses

• Miscellaneous Expense:  $4,743 (1.7%)
• Payroll Expenses and Taxes:  $12,047 (4.2%)
• Automobile Expense:  $2,468 (0.9%)
• Technology:  $3,200 (1.1%)
• Marketing and Advertising:  $3,937 (1.4%)
• Meals and Entertainment:  $2,314 (0.8%)
• Administrative and Insurance:  $15,870 (5.6%)
• Total Selling, General, and Administrative Expenses:  $44,579 (15.70%)

Royalty and Brand Fund Fee

• Implied Royalty Fee (7%):  $19,924 (7.0%)
• Implied Brand Fund Fee (1%):  $2,846 (1.0%)
• Total Royalty and Brand Fund Fee:  $22,770 (8.0%)

Net Income/Owner Profit:  $85,467 (30.0%)

• Revenue is defined to include all income of any type or nature and from any source that you derive or receive directly or indirectly from, through, by or on account of the operation of the Franchised Business in whatever form and from whatever source, including but not limited to cash, services, in kind from barter and/or exchange, on credit, redemption of a gift card, or otherwise as well as business interruption insurance proceeds, all without deduction for expenses including marketing expenses and taxes.

• Marketing Expenses include any discounts offered in store or via any third-party website or promotional marketing program.

• However, the definition of Revenue does not include sales tax that is collected from customers and actually transmitted to the appropriate taxing authorities.

• These outlets have earned these amounts. Your individual results may differ. There is no assurance that you’ll earn as much.

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