Starting a Monkey Joe’s play center for children is an act of franchising the Monkey Joe’s brand. Owning your own Monkey Joe’s location could be a great way to expand your business assets, even for beginners, since the company prides itself on helping franchisers in the form of financing and assistance in various aspects of running your own Monkey Joe’s.
If you want to open your own Monkey Joe’s, though, you need to be aware of and prepared for the various costs associated with franchising. In this guide, we outline the costs of franchising a Monkey Joe’s in detail, and we address some of the best ways you can lower costs with budgeting tips.
Costs of Opening a Monkey Joe’s
Initial Investment Costs
The cost of investment can be broken down into a few different factors (namely, the fixed franchising fee and the investment estimate).
The franchise fee for opening a Monkey Joe’s is $40,000 per store.
According to the Monkey Joe’s website, the average investment cost for opening a Monkey Joe’s chain ranges from $918,088 – $1,484,129. According to their page, this estimate shifts depending on various real estate and leasing factors for your location.
Loans and Securing Financing
While the initial investment costs can be estimated, it’s also worth it to consider extra costs you’ll need to secure funds. Namely, think about the money you’ll spend to secure a business credit card, business loan, or other form of credit to fund your franchise location.
Most businesses need a credit card to cover day to day expenditures or purchases that require speediness. On average, the cost of opening a business credit card can be broken down into the following costs:
- Average annual fee cost – $118
- Average minimum APR (purchase interest rate) – 16%
- Average cash advance fees – $5-$10
Additionally, most business owners will require a loan or some sort of line of credit in order to afford the initial investment costs. The average cost of a new business loan is primarily based on the cost of interest and upfront fees:
- Interest – 5.5-8% for small business and 10-99% for a business line of credit
- Upfront fees – 0-10% of the loan amount
You’ll notice that if you choose to take out a loan to secure your new business, you can very easily start to accrue a lot of interest. Note that Monkey Joe’s provides financing assistance in some cases, so you may be able to get a better deal with their help.
Other Franchising Fees and Royalties
Since you will be essentially operating under a parent company, you should be prepared to pay back some of your profit to Monkey Joe’s. This expense can get costly in any franchising situation.
Specifically, Monkey Joe’s charges each franchiser a 5% royalty fee, along with a required 2-3% you must contribute to the company’s shared marketing fund.
Accounting Systems Costs
While Monkey Joe’s provides your franchise with accounting systems, including inventory control systems, daily sales summaries, and more, you may still consider the cost of accounting assistance.
If you decide that you require a little more help to make running the business easier, consider the average cost of an online accounting service. Popular bookkeeping services like Intuit QuickBooks charge around $200 per month for full service bookkeeping.
Supplies and Equipment
You’ll also want to consider regular expenses for supplies and equipment – things that have to be bought frequently and re-stocked. Some of the most common expenses you’ll encounter in this arena include:
- Cleaning supplies
- Arcade games
- Food and drink for the concessions area
- Party supplies (cups, tablecloths, utensils, paper plates, balloons, party invitations, goody bags, souvenirs)
- Furniture (tables, chairs, etc.)
You also need to account for certain business equipment, like a telephone and telephone service. The average cost of telephone equipment is $60-$120, and the average cost of a business phone line service is $40-$75 per month. These are base costs and will increase with a multi-line service.
Marketing and Advertising Costs
While at first glance it may seem like you don’t need to do much work to market a franchise, this step is equally important to the others. Even though franchises operate under popular and already-established brand names, you still have to do some work to maintain the image and ensure that potential customers in your location are aware of your store to begin with.
While Monkey Joe’s may have a franchise marketing plan in place for you to follow, there are still ways you can enhance your advertising and reach a larger audience. Monkey Joe’s claims to provide assistance to franchisers when it comes to marketing plans, public relations, campaigns, and more.
But to make your store’s reach even better, you might consider investing some time and money into social media outreach. According to Oberlo, 48% of the global population (3.78 billion people) use social media. And of this population, people in the typical age range for parents of young children make up a huge portion (84% of these people are 18-29 years old and 81% are 30-49 years old).
Given these stats, you may find it pertinent to start an Instagram, Twitter, or Facebook account for your Monkey Joe’s specific location or hire a social media expert to optimize your social media outreach. Social media experts can be found on most freelancing websites, and they typically charge around $15-$250 per hour depending on what you need. They could help you to advertise the following to a much larger audience:
- Local deals on party booking
- Specials you may be having at your location
- Reservation information
- Win-a-party contests
Location and leasing will also play a role in how much you spend to open a franchise store. You have to consider the costs of leasing or property expenses, average cost of utilities, etc.
Take a look at some of the average costs of leasing industrial (commercial business) property across various U.S. metro areas:
|Location||Average Cost of Store Lease|
|Boston, MA||$10 per square foot per year|
|Los Angeles, CA||$11 per square foot per year|
|Philadelphia, PA||$6 per square foot per year|
|Chicago, IL||$6 per square foot per year|
|Dallas, TX||Less than $5 per square foot per year|
|Atlanta, GA||$5 per square foot per year|
|Miami, FL||$8 per square foot per year|
Note that these average costs for leasing business space are based on city areas, and these costs are typically less in more rural or suburban areas. You also need to consider what you’ll be paying in terms of your franchise’s utilities, insurance, maintenance fees, and more. While some commercial space leases include the costs of certain fees, others do not. So, you need to be extra careful when considering a space for your Monkey Joe’s franchise.
There are property insurance costs, property taxes, as well as specific fees in commercial leases called common area maintenance fees, which represent charges for outdoor lighting, parking lot maintenance, property landscaping, and more. Some landlords will include these three types of expenses in your lease (triple net lease), while others will tack these expenses on top of your rent. Make sure you know what the setup is before signing a lease, as these extra expenses could be several hundred dollars more than the cost of rent.
You may not be thinking of this expense when you first start out, but one you’re a part of a franchise, you may be faced with business-related travel. In this case, you need to account for the costs of flights, gas, travel food, and more on some occasions.
How to Save Money
All in all, there are a lot of expenses involved in opening a Monkey Joe’s franchise location. But that doesn’t mean there aren’t ways to budget and save on expenses. Consider the following to help you reduce costs:
- Closely monitor your business credit card bills and daily expenses (this will help you stay on top of spending habits and cut back).
- Use coupons or buy supplies in bulk (cleaning supplies, paper and plastic goods, etc.).
- Save on utilities costs, by ensuring bathrooms are well-maintained, lights get turned off at the same time after closing every night, etc.
- Use your business credit cards sparingly so you limit the amount of interest you accrue.
- Make your credit card and business loan payments on time or ahead of time every time.
- Make use of DIY marketing (build your own website, social media presence, and more).
- Choose a good bank or credit company to fund your business (one that doesn’t rip you off in the fine print or charge excessive fees).
Opening your own Monkey Joe’s franchise location is made easier with the help of the company. They will assist you in a lot of the process, even offering to train you if you don’t have a ton of experience in this arena.
However, you still need to be prepared for both the initial investment costs and ongoing expenses of running a business in this manner. Be prepared to spend a minimum of around $960,000 to begin this journey, and prepare yourself for ongoing expenses for leasing, cleaning, maintenance, advertising, and more.