Food on the go – Spudbar facts & figures

Spudbar  Hot Potatoes

Serving up: baked potatoes, salad, corn cobs and yoghurt

Facts and Figures

Franchise fee: $35,000 plus GST

Working capital: $5,000 to $10,000

How much is invested in stock/supplies? $3000

Is this a turnkey operation? Yes

Royalty fee: seven per cent

Marketing levy: three per cent

Term: five years but a new store can be aligned to the lease term if required.

Renewal fee: none but franchisee pays legal costs for new documentation and any lease renewal costs.

Lease: typically, the franchisor holds the lease and enters into an Occupancy Agreement with the franchisee.

Operating hours: shopping centre stores trade seven days and late on Thursday and Friday; strip shops are typically open for lunch and dinner seven days a week; stores in office precincts open only for weekday lunches.

Average customer spend: $10 (50 per cent buy a drink with their meal).

The franchise fee essentially buys a turnkey operation: an operating manual, three weeks start up training, opening on-site support, full project management of the store design and construction process. Training is included; a three week pre-opening intensive program completed in-store and in Spudbar's training facility in Port Melbourne. After opening, there is seven days on-site support. What is not included? Spudbar's legal fees for preparation of franchise agreement and review of lease and opening promotion costs are additional. So what does the franchisee get in return for royalty fee and marketing levy? The royalty provides ongoing support from head office; operating manual updates, advice, supplier discounts, ongoing training, in-store support, analysis of monthly financial statements. The marketing levy includes advertising, events, sponsorship and competitions.

Supplier rebates such as landlord's contribution and in-store poster displays are fully passed onto the franchisee.

All food is prepared on site, reflecting the fresh, healthy nature of the meal offering.

A loyalty scheme is in place across all stores where customers receive the 10th meal free - this is very popular.

For the future? At the end of 2008 there will be 10 stores across Australia and New Zealand and the target for 2009 is to double this figure.