Foundation Franchising, LLC Franchise Review (2026): Costs, Fees, Revenue Potential

• Category: Food & Beverage
• Initial Investment: $175,100 to $382,500
• Franchise Fee: $39,500
• Royalty: 5% of Gross Revenue
• Marketing / Ad Fee: 1% of Gross Revenue, with the disclosure stating it may increase up to 3%
• Key additional recurring fees: Technology system fee of $250 per month; possible convention, training, audit, and management fees in certain situations
• Number of locations: 3 company-owned outlets disclosed; no franchised outlets shown in Item 20
• Best Fit: Manager-led owner or active oversight owner, rather than passive ownership

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The estimated initial investment ranges from $175,100 to $382,500, which places this in a mid-cost startup range based on the disclosure.

Major cost drivers include:

• Initial franchise fee: $39,500
• Leasehold improvements: $45,000 to $150,000
• Buildout management: $5,000 to $8,000
• Rent for 3 months: $4,800 to $16,000
• Management and technology system: $2,000 to $4,000
• Additional funds: $25,000 to $50,000

The largest variable appears to be buildout and leasehold improvement cost. That means site selection and landlord terms could materially affect the final opening budget. The disclosure also indicates a physical location with equipment and technology needs, so this is not a minimal-capital or home-based model.

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• Royalty fee: 5% of Gross Revenue, paid monthly
• Brand fund contribution: 1% of Gross Revenue, paid monthly; may increase up to 3%
• Technology fee: $250 per month
• Training fee: $0 for up to 3 people at initial training; $500 per additional person
• Ongoing/remedial training: $500 to $1,000 per day per employee, plus travel costs
• Annual convention fee: $500 per attendee
• Transfer fee: $10,000, including a $2,500 non-refundable deposit
• Renewal fee: greater of $10,000 or 25% of the then-current franchise fee
• Relocation fee: $5,000
• Management fee: 5% of Gross Revenue if the franchisor manages the business, in addition to royalty
• Audit fee / reimbursement / indemnification: based on actual costs in specified situations

At the base level, the recurring fee load is relatively modest at 6% of Gross Revenue plus the $250 monthly technology fee. The main consideration is that several contingent fees can add cost if operations do not go smoothly or if ownership changes later.

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Yes, the FDD includes an Item 19 financial performance representation based on 3 company-owned outlets operating for the full 2024 fiscal year: Shelton, Orange, and Carmel.

Reported gross revenue

• Average gross revenue: $659,240
• Median gross revenue: $640,649
• Range: $602,858 to $734,212

Reported outlet-level figures from Item 19

• Shelton
  • Gross Revenue: $640,649
  • COGS: $347,744
  • Gross Profit: $292,905
  • Total Operating Expenses: $159,094
  • EBITDA (if franchised): $133,811
• Orange
  • Gross Revenue: $602,858
  • COGS: $332,131
  • Gross Profit: $270,727
  • Total Operating Expenses: $165,947
  • EBITDA (if franchised): $104,780
• Carmel
  • Gross Revenue: $734,212
  • COGS: $414,555
  • Gross Profit: $319,657
  • Total Operating Expenses: $177,762
  • EBITDA (if franchised): $141,895

EBITDA (if franchised)

• Average: $126,829
• Median: $133,811
• Range: $104,780 to $141,895

The spread in revenue is present but not extreme across the three disclosed outlets. Even so, this is a very small sample, and the disclosure states that nine licensed locations were excluded because they do not operate in a substantially similar manner to the franchised business being offered.

Two important cautions:

• Revenue is not profit. Gross revenue only shows sales, not what an owner keeps after all costs, debt service, taxes, owner compensation, and other obligations.
• The Item 19 table includes an "EBITDA (if franchised)" figure, but that is still not the same as net profit or owner earnings.

The disclosure states the figures are based on historical results from company-owned outlets and estimated franchise fees as if those outlets had operated under the current franchise agreement. The disclosure does not clearly establish whether these figures are audited.

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• Primary model: Retail health and wellness business focused on vitamins and sports supplements
• Customer type: The disclosure suggests a retail model; audience classification in the source is mixed, but the business appears consumer-facing at the outlet level
• Revenue pattern: Likely product sales rather than long-term contracted revenue
• Operations: Physical location, leasehold improvements, rent, inventory/COGS, payroll, insurance, and technology systems
• Ownership structure: The disclosure strongly recommends personal participation by the owner or operating principal and indicates a dedicated manager is required

This appears to be an operating business with real store-level execution demands, not a passive licensing arrangement.

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Advantages

• Item 19 provides actual outlet-level revenue and expense data for three company-owned stores.
• Base recurring fees are straightforward: 5% royalty + 1% brand fund + $250 monthly technology fee.
• The three disclosed outlets all reported gross revenue above $600,000 in the measurement period.
• Item 20 shows three company-owned outlets operating consistently from 2022 through 2024.

Considerations

• The franchise system is new to franchising; the disclosure states it had not previously sold franchises before issuance of the FDD.
• Item 19 is based on only three comparable outlets, which limits how much can be inferred about broader system performance.
• Non-exclusive territory reduces geographic protection.
• Startup cost can reach $382,500, with leasehold improvements creating substantial variability.
• Cost of goods sold is significant in the Item 19 table, which means margin management appears important to the model.

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This franchise may fit someone comfortable operating a physical retail business with inventory, staffing, rent, and day-to-day oversight. It may also fit an owner who plans to stay involved directly or supervise a manager closely.

It likely does not fit someone seeking passive ownership, exclusive territorial protection, or a concept with a long franchising track record already established in the disclosure.

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• The initial term is 10 years, creating a long contractual commitment.
• Renewal requires paying the greater of $10,000 or 25% of the then-current franchise fee per designated territory.
• Some defaults have short cure periods of 10 or 30 calendar days, and some defaults are described as non-curable.
• If the franchisor manages the business on your behalf, it can charge an additional 5% of Gross Revenue management fee.
• The brand fund contribution can increase from 1% up to 3% of Gross Revenue.

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Foundation Franchising, LLC presents a retail supplements model with a moderate initial investment, a relatively light base royalty structure, and a rare level of outlet-level operating data in Item 19. The main tradeoff is that buyers get some concrete revenue and expense history, but from only three company-owned outlets in a system that is new to franchising and does not offer exclusive territory.

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