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Destination Athlete Franchise ProfileSports Franchises > Sports Equipment Retail |
What Are the Initial Investment Requirements for a Destination Athlete Franchise?
To open a Destination Athlete franchise, you will need to prepare for a significant initial investment. The total investment ranges from $28,300 to $93,610, which includes a franchise fee of $20,000. It's important to have liquid cash available within this range, as well as a net worth between $100,000 and $400,000 to qualify for franchise ownership. Understanding these financial commitments is crucial for aspiring franchisees to ensure they are financially prepared to embark on this business journey.
What Ongoing Fees Should Franchisees Expect?
Franchisees of Destination Athlete should be aware of ongoing fees that will impact their profitability. An 8% royalty fee is charged on gross sales, along with a 2% marketing fee. These fees are essential for maintaining brand standards and supporting marketing efforts. It's vital for potential franchisees to factor these costs into their financial planning to accurately assess the overall viability and profitability of their investment.
What Are the Financial Performance Metrics for Destination Athlete Units?
Understanding the financial performance of Destination Athlete franchises can help prospective owners gauge potential earnings. The average annual revenue per unit is approximately $487,706, with a median revenue of $346,313. However, revenue can vary significantly, with the lowest annual revenue reported at $15,000 and the highest at $487,706. The breakeven time is estimated at around 12 months, with an investment payback period of about 24 months, making it essential for franchisees to have a solid financial strategy in place.
How Has the Franchise Grown Over Recent Years?
Destination Athlete has shown promising growth in its franchise model over recent years. In 2019, there were 73 franchised units, which increased to 128 in 2020, and further grew to 151 in 2021. This upward trend indicates a strong market demand and brand acceptance, making it an attractive opportunity for new franchisees. Understanding the growth trajectory can provide insights into the franchise's stability and potential for future expansion.
Destination Athlete Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
Destination Athlete Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2019 | 2020 | 2021 |
|---|---|---|---|
| Total Units | 75 | 128 | 151 |
| Net Change YoY | 53 | 23 | |
| Franchised Units | 73 | 128 | 151 |
| Net Change YoY | 55 | 23 | |
| Corporate Units | 2 | 0 | 0 |
| Net Change YoY | -2 | 0 |
Investment Overview
The Destination Athlete franchise presents an appealing investment opportunity with an initial investment ranging from $28,300 to $93,610. This includes a franchise fee of $20,000, alongside ongoing royalty and marketing fees of 8% and 2%, respectively. Potential franchisees should be prepared with a cash reserve between $28,300 and $93,610 and a net worth of $100,000 to $400,000 to meet the financial requirements.
Revenue Potential
Destination Athlete franchises have demonstrated promising revenue potential, with an average annual revenue per unit reaching $346,313. Notably, the highest annual revenue recorded is $487,706, while the lowest stands at $15,000. This variance highlights the importance of location, management, and market conditions in achieving optimal financial performance.
Breakeven and Payback Period
Franchisees can expect to reach breakeven within approximately 12 months of operation. The investment payback period is projected at 24 months, suggesting that franchisees can recover their initial investment relatively quickly, provided they effectively manage their operations and marketing strategies.
Growth Trajectory
The Destination Athlete franchise has shown significant growth, increasing from 73 franchised units in 2019 to 151 units in 2021. This upward trend indicates a robust demand for the brand and a successful expansion strategy, making it an attractive option for investors looking to capitalize on a growing franchise system.
Operational Expenses
Understanding the operational expenses is crucial for franchise success. Average running expenses total approximately $543,300 annually, with significant costs attributed to payroll and benefits ($181,032) and advertising ($64,147). Franchisees must carefully manage these expenses to maintain profitability and ensure a sustainable business model.
Corporate Structure
Destination Athlete operates under a corporate structure that emphasizes franchisee support and brand integrity. With a focus on empowering franchisees through comprehensive training and resources, the company is dedicated to fostering a collaborative environment that enhances operational efficiency and drives overall brand success.
Frequently Asked Questions
The initial investment for a Destination Athlete franchise ranges from $28,300 to $93,610, which includes the franchise fee and other startup costs.