Briefly summarize your fellow student's selected franchise information and financing option selected in your response post and provide your opinion on the following:

1. Do you agree or disagree with your fellow student's conclusion on the worthiness of the franchise investment they selected and the financing option preferred?
2. Why or why not?

Page - Post 1

Founded in 1950 by Bill Rosenberg, Dunkin' Donuts is one of the world's leading baked goods and coffee chains. Its headquarters are located in Canton, Massachusetts and they have more than 11,300 restaurants worldwide. Dunkin' is part of the Inspire Brands family of restaurants which include familiar places such as Arby's, Baskin-Robins, Buffalo Wild Wings, Jimmy John's, and Sonic. Dunkin' offers benefits for select developing markets that may include a 48-month royalty reduction for a traditional development and a 36-month ad fund reduction for traditional development.

DUNKIN' DONUT (Traditional)

FRANCHISE FEE

$40k - $90k

CONTINUING FRANCHISE FEE

5.9%

STORE SIZE

750 - 3100 sq.ft.

MINIMUM NET WORTH

$500k

ADVERTISING FEE

5%

INVESTMENT RANGE

$526,900 - $1,809,500

DUNKIN' DONUT (Non-Traditional)

CONTINUING FRANCHISE FEE

5.9%

STORE SIZE

from 500 sq.ft.

FRANCHISE FEE

$10,000 - $90,000

ADVERTISING FEE

5%

MINIMUM NET WORTH

$500k

INVESTMENT RANGE

$121,400 - $1,310,500

For the traditional franchise with a franchise price of $90,000.00 with a 0.000% down payment and a 5.000% interest rate the total monthly payment would be $1,698.41 for a five-year mortgage. The total amount of payments will be $101,904.71 with $11,904.71 of that coming from financing charges. For a mortgage borrowing the same amount over a ten-year period with a 6.000% interest rate and 0.000% down payment the monthly payment would drop to $999.18 monthly with a total amount to be repaid at $119,902.26. Out of that amount $29,902.26 will be financing charges.

On the low end of things if you invest with a franchise price of $40,000.00 with a 0.000% down payment and a 5.000% interest rate the total monthly payment will be $754.85 for a five-year mortgage. The total amount of payments would equal $45,290.93 with $5,290.93 of that being financing fees. For a mortgage borrowing the same amount over a ten-year period with a 6.000% interest rate with 0.000% down payment the monthly payment would be $444.08. The total payment would be $53,289.91 with $13,289.91 of that being the financing charges.

Based on the information I have gathered I would try and find a non-traditional store front option that gathers a lot of foot traffic or that is located in a busy area such as a mall, office plaza, or airport. I would Select a 10-year mortgage payment option as the payments are under $500.00 per month and you would like to think you could gross at least two to three times that amount per month. I would try and pay this location off early and begin the investment process in another in a similar location. The key I feel in these investments are the right location so that you will have a market to sell your product too.

I chose a 10-year repayment period at 6% to safe-guard myself with lower payments because some months may be more successful than others but hopefully at this rate I will have some wiggle room from the good months and have some money for incidents that draw away from our bottom line.

References

About us: Our mission: Dunkin'. About Us | Our Mission | Dunkin'. (n.d.). https://www.dunkindonuts.com/en/about/about-us

Aebischer, C. (2020, October 22). How to buy a Dunkin' donuts franchise. NerdWallet. https://www.nerdwallet.com/article/small-business/dunkin-donuts-franchise

Donuts, D. (2023, April 24). Home. Curtis Carleton Site. https://www.dunkinfranchising.com/

Financial calculators: Timevalue software. Financial Calculators | TimeValue Software. (n.d.). https://www.timevalue.com/tcalc-financial-calculators/overview