Do you want to open a restaurant business by buying Twin Peaks franchise? If YES, here is how much it cost to open Twin Peaks franchise successfully. If you are looking towards opening a Twin Peaks Restaurant 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.
Twin Peaks Restaurant was founded in 2005 and they began franchising in 2007, about 13 years ago. The current CEO is Joe Hummel and they have their corporate head office at 5151 Beltline Rd, #1200 Dallas, TX 75254, USA. Currently the company owns and operates 75 franchises in the United States of America.
Twin Peaks is built upon five brand pillars: the Twin Peaks Girls, made-from-scratch food, 29° draft beer, sports on wall-to-wall TVs, and of course, the local lodge atmosphere.
Twin Peaks is constantly on the cutting edge of culinary innovations and indulgent, flavorful cuisine. This brand promises high quality food that far surpasses any other concept in the category. Twin Peaks features a balanced menu that delivers 44 percent of weekday lunch sales, and is not reliant on a single menu item that can expose a restaurant to commodity fluctuations.
With a focus on quality, detail, execution and fun, Twin Peaks has redefined the all-female wait staff, sports bar category. This focus on quality and fun attracts the most talented and best-looking wait staff in casual dining.
Here are areas where you are expected to spend money and the cost associated with it;
Financial Investment Required to Open a Twin Peaks Franchise?
1. Initial Franchise Fee: $50,000
You must pay Twin Peaks an initial franchise fee of $50,000 when you sign the Franchise Agreement. The initial franchise fee is uniform for all franchisees. It is considered fully earned and nonrefundable when paid. Please note that you also must reimburse Twin Peaks for any out-of-pocket attorneys’ fees that it incurs in connection with drafting negotiated amendments to your Franchise Agreement.
2. Development Fee: 100 percent of the initial franchise fee
For the first Restaurant to be developed and 50 percent of the initial franchise fee for each additional Restaurant to be developed When you sign the Area Development Agreement, you will pay a development fee equal to 100 percent of the initial franchise fee for the first Restaurant to be developed and 50 percent of the initial franchise fee for each additional Restaurant to be developed under the Area Development Agreement.
You also must reimburse Twin Peaks for any out-of-pocket attorneys’ fees that it incurs in connection with drafting negotiated amendments to your Area Development Agreement. When you sign the Franchise Agreement for the first Restaurant, Twin Peaks will credit $50,000 of your development fee payment to satisfy the $50,000 initial franchise fee due under the Franchise Agreement.
Please note that when you sign each additional Franchise Agreement under the Area Development Agreement, you will sign the then-current form of Franchise Agreement that Twin Peaks offers. In addition, you will pay Twin Peaks the balance due for the initial franchise fee due under the Franchise Agreement, which will be the initial franchise fee minus the applicable portion of the development fee.
3. Opening Training Team: $60,000 to $75,000
Twin Peaks provides an “Opening Training Team” of its trained representatives to provide on-site pre-opening and opening training, supervision, and assistance to you for up to 14 days based upon Twin Peaks’ assessment of the experience and training of your management personnel.
Please note that you must pay for the compensation, costs of travel, lodging, meals, and miscellaneous costs of the Opening Training Team. Twin Peaks estimates that the costs for the Opening Training Team will range from $60,000 to $75,000.
4. Royalty Fee: 5 percent of Gross Sales
And the Due Date for this fee is Every Tuesday for the preceding Reporting Period. Please note that you must pay the Royalty Fees by electronic funds transfer.
5. Brand Fund Contribution: Up to 4 percent of Gross Sales;
Currently 2.5 percent and the Due Date for this fee is Every Tuesday for the preceding Reporting Period.
Please note that you must pay the Brand Fund Contribution by electronic funds transfer.
- Local Marketing Expenditure and Advertising Cooperative: 0.5 percent of Gross Sales and the Due Date for this fee is Periodically.
Please note that no advertising cooperative fee is currently assessed.
- Marketing Materials: This fee varies but the Due Date is Upon invoice.
Please note that Twin Peaks may make available to you certain marketing material for display in the Restaurant or in connection with the promotion, advertising, and marketing of products and services offered by the Restaurant for purchase in an amount equal to Twin Peaks’ cost in supplying such marketing materials.
- Additional Training; Retraining: Reasonable fee (currently $150 per day for each person providing the training), plus expenses and the Due Date for this fee is Upon invoice.
- Inspection and Testing for Unapproved Suppliers, Products, or Equipment: Cost of inspection, if applicable, and cost of test and the Due Date for this fee is Upon invoice.
Please note that before approving a new supplier, product, or equipment, Twin Peaks may require you to pay the cost of testing the supplier’s products and/or equipment and inspecting its facilities.
- Quality Assurance Inspections: $450 to $500 and the Due Date for this fee is Upon invoice.
Please note that if you receive a failing score on inspection, you will reimburse Twin Peaks for the cost of such inspection as well as the cost of a follow-up inspection to confirm quality deficiencies have been cured.
- Mystery Shoppers: $125 per bar visit and $140 per dining visit and the Due Date for this fee is Upon invoice.
Please note that you will pay for regular mystery shopper visits (up to 36 visits annually), plus any additional visits to confirm deficiencies noted during evaluation have been cured.
- Audits: Cost of audit, plus interest and the Due Date for this fee is Upon invoice.
Please note that you pay the cost of an audit only if it shows an understatement of your Gross Sales, Royalty Fees, or Brand Fund Contributions, or an understatement of 1.25 percent or more from data reported to Twin Peaks in respect to any other item that is material to the computation of fees or analysis of the operation.
- Improvements: Currently, up to $500,000 for improvements required during the initial term of the Franchise Agreement and the Due Date for this fee is Upon invoice.
Please note that it is Payable to Twin Peaks as reimbursement for any required improvements it makes to your Restaurant following your failure to make the improvements within the time period described in the Franchise Agreement.
- Transfer Fee: $12,500 and the Due Date for this fee is Upon application for consent to transfer.
Please note that the fee is Payable to Twin Peaks when you request its consent to transfer the franchise or your ownership.
- Successor Fee: 50 percent of the then-current initial franchise fee and the Due Date for this fee is 30 days before the end of the expiring term.
Please note that based upon the current initial franchise fee of $50,000, the successor fee is $25,000.
- Securities Offering Review: $10,000 and the Due Date for this fee is Upon invoice.
Please note that this fee is only Payable if you engage in a public or private securities offering that includes a prospectus or offering memorandum that Twin Peaks reviews.
- Late Fee: $150 for each delinquent report or payment and the Due Date for this fee is automatically upon next Electronic Transfer of Funds.
Please note that you must pay this fee in addition to interest for any payment or report received by the franchisor after the prescribed due date.
- Interest: 18 percent per annum or maximum lawful rate and the Due Date for this fee is On demand.
- Insurance: Premiums vary depending on location; currently, $45,000 to $70,000 for annual premiums and the Due Date for this fee is When premiums are due.
Please note that Twin Peaks has the right to obtain insurance for your Restaurant at your expense for premium, if you fail to purchase or renew your required insurance and provide proof of coverage to Twin Peaks.
- Indemnification: Varies depending upon claim and resolution of claim and the Due Date is Upon billing.
Please note that this fee is Payable if and when Twin Peaks defends a claim for which you indemnify it under the Franchise Agreement or Area Development Agreement (if applicable).
- Costs and Legal Fees: Actual legal fees and expenses and the Due Date is Upon billing.
Incurred only if a court determines that you have breached the Franchise Agreement or Area Development Agreement, if applicable.
Please note that Legal fees and expenses will vary depending on factors such as the nature of the legal matter, venue, and the complexity of the legal matter.
- Liquidated Damages (Undeveloped Restaurants): $50,000 per undeveloped Restaurant and the Due Date for this fee is Upon demand.
- Liquidated Damages (Termination of Franchise Agreement): Lump sum payment equal to the Royalty Fees for the remainder of the initial term or successor term, if applicable, based upon the average weekly Royalty Fee for the previous two years and the Due Date for this fee is Upon demand.
- Veteran Incentives: You can negotiate this with the company.
- 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: Twin Peaks Restaurant has relationships with third-party sources which offer financing to cover the following: franchise fee, startup costs, equipment, inventory, accounts receivable, and payroll et al.
In Summary,
- Initial investments: $225,900 – $687,000
- Net-worth Requirement: $500,000
- Liquid Cash Requirement: $200,000
- Ongoing Initial Franchise Fee: $40,000
- Ongoing Royalty Fee: 3 percent
- Ad Royalty Fee: 2.5 percent