If you are looking towards opening a Beef Jerky Outlet Franchise, it will be nice for you to have a preview of what the company represents before going ahead to enquire about the total cost of opening the franchise in your location. Beef Jerky Outlet was founded in 1995 and they began franchising in 2010, about 10 years ago.
The current CEO is Scott Parke and they have their corporate head office at Seymour, Tennessee, USA. As of 2018, Beef Jerky Outlet owns and operates a chain of 100 franchises in the United States. They also have franchise locations in 30 states. The largest region is the South with 49 franchise locations.
The Beef Jerky Outlet, Inc. operates the Beef Jerky Outlet turnkey franchise system in the United States. It provides franchising opportunities to open and operate a Beef Jerky outlet to sell beef. Beef Jerky Outlet products are unique in that they are made in small batches and not distributed in the mass market.
Beef jerky fans from far and wide arrive in “beef jerky heaven” when they visit any jerky franchise stores and are always seen wearing a smile. They offer their guests a unique sales proposition – Try Before You Buy. Here are areas where you are expected to spend money and the cost associated with it;
Financial Investment Required to Open Beef Jerky Outlet Franchise
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Initial Investment Range: $215,750 to $394,900
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Initial Franchise Fee: $22,450 to $44,900
Please note that you must pay Beef Jerky Outlet an initial franchise fee of $44,900, payable in a lump sum when you sign the Franchise Agreement, for the right to establish a single Store. If you are a qualified United States veteran, Beef Jerky Outlet will reduce the initial franchise fee (for your first Store only) by 50%. The initial franchise fee is therefore not imposed uniformly on all franchisees. The initial franchise fee is not refundable under any circumstances.
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Pre-Opening Purchases and Charges: $10,000 to $15,000
Please note that you must purchase from Beef Jerky Outlet’s affiliate, PLE, a portion of your initial inventory of specialty food products, including jerky products, sausages, smoked meats, and other specialty food items. Beef Jerky Outlet estimates that the cost of these items will be between $10,000 to $15,000. There are no refunds.
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Technology System Set-Up Fee: $950
Please note that you must also pay Beef Jerky Outlet a Technology System Set-Up Fee of $950 at the time of signing the Franchise Agreement. It is not refundable under any circumstances.
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Grand Opening Fee: $5,000
Please note that at the time of signing the Franchise Agreement, you must also pay to Beef Jerky Outlet the sum of $5,000 for your business kickstart assets. Beef Jerky Outlet will hold these funds for you and remit payment to marketing vendors when they are due. If you do not open the franchise, Beef Jerky Outlet will refund any unused portion of this fee to you.
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Development Fee
100% of the initial franchise fee for the first Store to be developed ($44,900), plus a deposit equal to 50% of the reduced initial franchise fee ($14,950) for each additional Store to be developed. Please note that if you sign a Multi-Unit Operator Agreement with Beef Jerky Outlet, the initial franchise fees you pay under the individual Franchise Agreements will be $44,900 for the first Store and $29,900 for each additional Store you develop.
When you sign the Multi-Unit Operator Agreement, you must pay Beef Jerky Outlet a development fee equal to 100% of the initial franchise fee for the first Store to be developed ($44,900) and sign a Franchise Agreement for this first Store, plus a deposit equal to 50% of the reduced initial franchise fee ($14,950) for each additional Store to be developed under the Multi-Unit Operator Agreement.
For your first Store, Beef Jerky Outlet will apply a portion of the development fee to pay the initial franchise fee in full. For each Store developed after the first one, Beef Jerky Outlet will apply a pro rata portion of the development fee towards the initial franchise fee due under the then-current Franchise Agreement and the balance of the initial franchise fee due, or $14,950, is payable when you sign the Franchise Agreement for the Store.
Beef Jerky Outlet reserves the right to adjust this formula depending upon the size of the area and the financial ability of the Multi-Unit Operator. The development fee must be paid in a lump sum and is non-refundable.
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Royalty
6% of Gross Sales and the Due Date for this fee is Payable on Tuesday of each week for the week ending Sunday (or the next business day if any Tuesday is not a business day). Please note that Royalty Fees are calculated based on Gross Sales for the previous week ending Sunday. Amounts due will be withdrawn by Electronic Funds Transfer (EFT) from your designated bank account.
8. Brand and Technology Fee
2% of Gross Sales and the Due Date for this fee is Payable at the same time and in the same manner as the Royalty Fee. Please note that Beef Jerky Outlet may increase the Brand and Technology Fee, up to a maximum of 4% of Gross Sales, with 30 days prior notice to you.
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Local Marketing
2% of Gross Sales and the Due Date for this fee is that it Must be spent monthly. Payable to your local marketing suppliers. Please note that any marketing materials you wish to use must first be approved by Beef Jerky Outlet.
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Corporate Training Location Training Program (New or Additional Trainees)
Beef Jerky Outlet’s then-current fee per person, plus expenses. Current training fee = $500 per day and the Due Date for this fee is Before training. Beef Jerky Outlet will train you and/or your Designated Manager at no additional charge.
Please note that if you request that Beef Jerky Outlet provide its initial training program to any additional employees, or to new or replacement employees during the term of your Franchise Agreement, you must pay its training fee as well as the trainees’ expenses, including travel, lodging, meals, and wages.
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Additional Training at Your Location – On-Site Training or Assistance
Beef Jerky Outlet’s then-current per diem fee per trainer, plus expenses. Current per diem fee = $500 to $1,500 and the Due Date for this fee is When incurred. Please note that if you request that Beef Jerky Outlet provide additional training at your Store, or if it determines that you need additional training, you must pay Beef Jerky Outlet’s daily fee for each trainer it sends to your Store, and you must reimburse each trainer’s expenses, including travel, lodging, and meals.
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Transfer Fee
Franchise Agreement: $10,000; Multi-Unit Operator Agreement: $20,000 and the Due Date for this fee is Closing date of transfer. Please note that No fee charged for: (i) a one-time transfer from individual(s) to a corporate entity formed for convenience of ownership of the franchise, (ii) transfer to a family member Beef Jerky Outlet approves, (iii) transfer to family member due to death or disability.
- Renewal: $2,500 and the Due Date for this fee is When you sign the renewal Franchise Agreement.
- Relocation Assistance: Reimbursement of Beef Jerky Outlet’s costs (estimated to be $750 to $1,500) and the Due Date for this fee is On demand, if incurred.
Please note that if you request Beef Jerky Outlet’s assistance to relocate your Store.
- Indemnification: This fee will vary under circumstances but the Due Date is On demand.
Please note that you must reimburse Beef Jerky Outlet for the costs it incurs if it is sued or held liable for claims that arise from your operation of the business or for costs associated with defending claims that you used the Marks in an unauthorized manner.
- Costs and Attorneys’ Fees: This fee will vary under the circumstances but the Due Date is On demand.
Please note that if you default under your Agreement, you must reimburse Beef Jerky Outlet for the expenses it incurs (such as attorneys’ fees) in enforcing or terminating your agreement.
- Customer Service: Reimbursement of Beef Jerky Outlet’s costs in assisting your customers and the Due Date for this fee is On demand.
Please note that if Beef Jerky Outlet determines it is necessary for it to provide service directly to your customers. Costs you must reimburse include a per diem fee of $600 per day, plus travel and living expenses for Beef Jerky Outlet’s representative.
- Interest on Overdue Amounts: The lower of 1.5% per month or the highest rate Beef Jerky Outlet can charge by law and the Due Date for this fee is If incurred.
Please note that Interest is payable on any amounts owed to Beef Jerky Outlet or its affiliates that are not paid when due. Interest accrues from the original due date until payment is made in full.
- Non-Sufficient Funds (NSF) Charge: $35 per NSF occurrence and the Due Date for this fee is If incurred.
Please note that Beef Jerky Outlet will access a $35 fee for each NSF for any bank ACH.
- Audit: Cost of audit (estimated to be between $1,500 and $5,000) and the Due Date for this fee is On demand.
Beef Jerky Outlet has the right to audit your books at any time. Please note that if an audit shows that you have understated Gross Sales or any amount owed to Beef Jerky Outlet by 3% or more, or that you have not conducted the minimum local marketing requirement, you must reimburse the costs of the audit, including fees and expenses. You must also pay any understated amount plus interest.
- POS System and Loyalty Maintenance and Support: $99 to $300 and the Due Date for this fee is Monthly but it is Payable to the supplier.
- Technology and Systems Set-Up Fee: $950 and the Due Date for this fee is Upon signing Franchise Agreement but it is Payable to Beef Jerky Outlet.
- Technology Subscription and Support Fee (including store and owner email, email marketing subscriptions, and local website profiles): $100 to $250 and the Due Date for this fee is Monthly. Prorated upon activation and then billed on the 1st of every month.
Please note that it is Payable in the same manner as the Royalty Fee. Payable to Beef Jerky Outlet.
- Store Refresh: Repair, Maintenance, and Remodeling / Redecorating: This fee will vary under the circumstances and the Due Date for this fee is As incurred but it is Payable to approved suppliers.
Please note that you must regularly clean and maintain your Store and its equipment. Beef Jerky Outlet may require you to remodel or redecorate your Store to meet its then-current image for all Beef Jerky Stores. Beef Jerky Outlet will not require you to remodel or redecorate your Store more frequently than every five years.
- Product Purchases: This fee will vary, depending on how quickly inventory is sold and the Due Date is As incurred.
You must purchase your continuing supply of certain specialty food products from Beef Jerky Outlet’s approved or other authorized vendors. Please note that Shipping charges to you will vary depending upon distance from vendors to your franchise site.
- Prohibited Product or Service Fee: $250 per day of use of unauthorized products or services and the Due Date for this fee is If incurred.
Please note that it is in addition to other remedies available to Beef Jerky Outlet.
- Insurance Premiums
Reimbursement of Beef Jerky Outlet’s costs, plus 10% administrative fee and the Due Date for this fee is On demand. Please note that if you do not maintain the required insurance coverage, Beef Jerky Outlet has the right (but not the obligation) to obtain insurance on your behalf.
- Product or Supplier Evaluation Fee: No charge for first 15 SKU’s per year; $25 for each of SKU’s 16-25 per year; $50 for each of SKU’s 26-35 per year and the Due Date for this fee is On demand, if incurred.
Please note that if you wish to purchase any product or purchase from any supplier that Beef Jerky Outlet has not approved, you must submit the request to Beef Jerky Outlet for approval on its new item request form. If Beef Jerky Outlet approves the product or supplier for all Stores in the System, it reserves the right to waive the fee.
- Management Fee: Beef Jerky Outlet’s then-current per diem fee per representative, plus expenses. Current per diem fee = $600 and the Due Date for this fee is if incurred.
Beef Jerky Outlet may step in and manage your Store in certain circumstances, such as your death, disability, or prolonged absence. Please note that Beef Jerky Outlet will charge a management fee, in addition to the other fees it charges, if it manages your Store. You must reimburse its expenses.
- Damages for Loss of Bargain on Termination: The present value of the royalty fees that you would have paid to Beef Jerky Outlet for the lesser of: (i) the balance of the term of the Franchise Agreement if the Franchise Agreement had not been terminated; or (ii) 104 weeks.
The Due Date for this fee is On termination. Please note that you must pay Beef Jerky Outlet liquidated damages if the Franchise Agreement is terminated before the end of the term, except for termination by you for cause.
- Veteran Incentives: 50% off first-store franchise fee
- Term of Agreement and Renewal: The length of the initial franchise term is 10 years. If requirements are met, franchisees can renew for one additional term of 10 years.
- Financial Assistance: Beef Jerky Outlet Franchise Inc. has relationships with third-party sources which offer financing to cover the following: franchise fee, startup costs, equipment, and inventor et al.
In Summary,
- Initial investments: $215,750 – $394,900
- Net-worth Requirement: $450,000
- Liquid Cash Requirement: $150,000
- Ongoing Initial Franchise Fee: $44,900
- Ongoing Royalty Fee: 6%
- Ad Royalty Fee: 2%