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Kiddie Academy Franchise Costs $405K – $7.3M (+ 2024 Profits)

Kiddie Academy, founded in 1981, is a leader in educational childcare, headquartered in Abingdon, Maryland. This franchise started in 1992 and has since expanded significantly across the United States and Washington, D.C.

Kiddie Academy stands out in the competitive childcare market by offering a curriculum that emphasizes comprehensive child development, incorporating elements of technology, health, fitness, character, and academics into daily learning activities.

The franchise offers a unique business model that not only aims to educate children but also provides franchisees with substantial support to ensure their success.

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Initial investment

Type of ExpenditureAmount (for a Purchased Facility)
Total Initial Fee$65,000 – $145,000
Real Estate Acquisition, Construction Costs, and Construction$3,785,000 – $5,730,000
Professional Fees, Loan Fees and Soft Costs$205,000 – $500,000
Kitchen Equipment and Supplies$20,000 – $40,000
Supplies/Equipment for Inside of Academy, Playground, and Online Training Component$95,000 – $225,000
Outdoor Fixed Playground Equipment$100,000 – $255,000
Computer Hardware and Software and Classroom Technology$25,000 – $65,000
Office and Lobby Furniture, Office Equipment and Supplies, and Telephone System$10,000 – $30,000
Indoor and Outdoor Signage$20,000 – $40,000
Travel and Living Expenses while training and Plan Review$3,000 – $5,000
Transportation Vehicles and Equipment$0 – $5,000
Insurance and Utility Deposits$4,000 – $10,000
Business Licenses$3,000 – $5,000
Start-Up Marketing and Advertising Expenses$35,000
Additional Funds/Working Capital – 3 months after opening$45,000 – $165,000
Total$4,415,000 – $7,255,000

Note: The table above provides a snapshot of the main costs associated with starting the most common franchise format (as disclosed in the Item 7 of the Franchise Disclosure Document). For a complete overview of all the expenses involved with the various formats offered by the franchisor, please consult the Franchise Disclosure Document.

Franchise fees & Royalties

Initial Franchise Fee

The total initial fee is $145,000, payable in installments. This includes a $25,000 payment due upon signing the Franchise Agreement, followed by $50,000 when the site is accepted and a lease or purchase agreement is signed. Additional payments are due as construction milestones are reached. Fee reductions are available under certain conditions as described in our franchise agreement.

Royalty Fee

Royalties are 7% of Gross Revenues, payable weekly on revenues generated during the week that ended nine days earlier.

Marketing/Advertising Fee

Franchisees are required to spend at least 2% of the Gross Revenues generated by the Franchised Business or $10,000, whichever is greater, on local and community-based advertising and marketing programs annually.

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Franchise pros and cons

The Pros:

  • Site selection and real estate: Kiddie Academy assists its franchisees in their discovery process to identify suitable locations for their academies. Also, it provides them with designs, lease negotiations, and construction.
  • Exclusive territory protection: The franchisor allows the franchisees to operate their schools in a protected development market with a population of less than 125,000 within a one-mile radius of the academy. It does not authorize any other franchise in the designated area.
  • Third-party financing: The franchisor has relationships with third-party sources to help its franchisees with financing to fund their startup costs, franchise fees, equipment, inventory, and ongoing costs.
  • Marketing and branding: The franchisor makes available to its franchisees an array of resources to help them with public relations and lead generation. These include dedicated marketing systems such as national media, web development, regional advertising, email marketing, etc.
  • Training support: The franchisor has a detailed training program to help its franchisees learn the basics of the business concept and how to run and operate their academies. Its initial training program consists of 105 classroom hours, and it also has ongoing training and support programs such as security & operations and newsletters.
  • Flexible real estate: The franchisor has different franchise designs for franchisees to choose from, such as build-to-suit leases, purchase options, or in-line conversions.

The Cons:

  • Not a passive investment: The franchisor does not allow for absentee ownership. It requires franchisees to be actively involved in the day-to-day operations of their centers.
  • Not a mobile business: The franchise cannot be operated from home or a vehicle. Franchisees must establish a fixed office space, retail facility, or a warehouse
  • No global presence: The franchise does not have international locations, and marketing it outside the US may be difficult.

How to open a Kiddie Academy franchise

1: Review Financial Requirements

  • Initial Investment: Understand that starting a Kiddie Academy franchise requires an initial investment ranging from $250,000 to $370,000.
  • Financial Stability: Ensure you have the necessary financial stability, including sufficient net worth and liquid assets, as stipulated by Kiddie Academy.

2: Submit an Application

  • Complete Application Process: Fill out the Kiddie Academy application form detailing your business experience, financial background, and personal information.
  • Preliminary Approval: Await preliminary approval based on your application and financial qualifications.

3: Attend Discovery Day

  • Visit Headquarters: Participate in a Discovery Day at Kiddie Academy’s headquarters in Abingdon, Maryland, to gain deeper insights into the franchise’s operations and culture.
  • Meet Franchise Team: Engage with key members of the Kiddie Academy team to discuss your potential involvement and gather more detailed information about running a franchise.

4: Secure a Location

  • Site Selection Assistance: Utilize Kiddie Academy’s experienced real estate team to help select and secure an ideal location that meets specific demographic and market needs.
  • Lease or Purchase: Decide whether to lease or purchase the property for your academy, with guidance on zoning and construction from Kiddie Academy.

5: Obtain Financing

  • Financing Support: Leverage Kiddie Academy’s relationships with national and regional lenders to facilitate the financing process.
  • Prepare Documentation: Prepare and submit necessary loan documentation with the assistance of Kiddie Academy’s finance team.

6: Complete Training Program

  • Initial Training: Undergo comprehensive training at Kiddie Academy’s headquarters which includes both classroom and hands-on learning experiences.
  • Operational and Educational Training: Learn about Kiddie Academy’s proprietary Life Essentials® curriculum and the operational tools available to manage your academy effectively.

Disclaimer

Disclaimer: This content has been made for informational and educational purposes only. We do not make any representation or warranties with respect to the accuracy, applicability, fitness, or completeness of the information presented in the article. You should not construe any such information or other material as legal, tax, investment, financial, or other professional advice. Nothing contained in this article constitutes a solicitation, recommendation, endorsement, advertisement, or offer to buy or sell any franchises, securities, or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the franchise and/or securities laws of such jurisdiction.

All content in this article is information of a general nature and does not address the detailed circumstances of any particular individual or entity. Nothing in the article constitutes professional and/or financial and/or legal advice, nor does any information in the article constitute a comprehensive or complete statement of the matters discussed or the law relating thereto. You alone assume the sole responsibility of evaluating the merits and risks associated with the use of any information or other content in this article before making any decisions based on such information or other content.

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