How To's
What is The Real Cost of A Lemonshark Poke Franchise?
Fast-casual restaurants are profitable franchises because of their tried-and-tested business model. Big-name fast-casual restaurants like Subway, McDonald’s, and KFC can become an easy choice. However, other fast-casual restaurants may also have a place and opportunity to become an investment in the long run. One of them is LemonShark Poke, self-dubbed as a “fine casual” offering healthier food options for consumers needing a quick bite.
So, if you’re interested in franchising and learning more about the restaurant, here’s what to expect in franchising a LemonShark Poke restaurant.
LemonShark Poke Franchise Overview
Tobi Miller and Richard Gottlieb, owners of LemonShark Poke, have a deep connection to Hawaiian culture. Before starting LemonShark Poke, they had separate restaurants, but eventually formed the fast-casual restaurant franchise after meeting with Hawaiian chef, Brunson Achiu.
They started franchising LemonShark Poke in 2017 and currently have 12 locations, with 60 under development in the coming years.
Presently, they have seven signature Poke bowls available for diners:
- O.G. Hawaiian
- Samoan Ahi Pineapple
- Yuzu Lychee Albacore
- Sichuan Shrimp
- California Roll Bowl
- Coconut Shrimp Islander
- Power Bowl
Other food selections include their Hawaiian Hot Plates, appetizers, and sides. In addition, diners can even build their own Poke bowl.
Training
LemonShark Franchising, LLC (the franchisor) will provide a training program to its franchisees. Firstly, they can find and access training information in the LemonShark system. Moreover, operation methods in their California training offices or the franchisee’s location. Up to two supervisory or managerial personnel can attend alongside the general manager and principal owner. Meanwhile, for operating a TurnKey Makai restaurant, the franchisee will undergo a two-week training program.
The franchisor will provide another six-day training for managerial and supervisory personnel after opening the franchise on the franchisee’s first opened restaurant. Plus, the franchisor also has the right to conduct extra training for the principal owner and general manager after opening the franchise.
Additional training or conferences may be held. At times, the franchisor will require the principal owner and general manager to attend the annual conference.
Territory
The franchisee can only operate under the terms agreed on the Franchise Agreement, but they won’t have an exclusive territory. However, they will be granted a one to five-mile protected territory as arranged in the Franchise Agreement.
The franchisor has the following considerations in determining the protected territory:
- Demographics
- Population size and age
- Income levels
- Neighboring locations
- Traffic
- Road visibility
- Nearby LemonShark locations
Obligations and Terms of Agreement
The franchisee must appoint a principal owner, one who has the capabilities to handle the operational responsibilities. Their responsibilities only extend to a managerial capacity, to which they are expected to dedicate their full time to. They should also at least own 50% of voting rights and equity.
Aside from that, the franchise should also designate a general manager, who will take over as the principal owner in case they can’t fulfill their duties. They’re also not required to have any voting rights or equity.
As for selling, the franchisees must strictly follow what is mandated by the franchisor. Items such as gaming, vending machines, payphones, ATMs, internet kiosks, mechanical and electrical items are prohibited unless approved by the franchisor.
An initial franchise term for any LemonShark Poke franchise is 10 years. But, the franchisor can grant an additional 10-year period if a franchisee fulfills all requirements.
LemonShark Poke Franchise Cost
The estimated initial franchise fee for any LemonShark Poke ranges from $341,950 to $866,400. Among the additional expenses include royalty fees, marketing fund fees, and technology fees.
Unfortunately, the franchisor doesn’t offer financing options and will not guarantee a franchise note, obligation, or lease.
You can refer to the tables for the breakdown of the franchise fee and other costs in starting a LemonShark Poke franchise.
Your Investment
| Name of Fee | Low | High |
|---|---|---|
| Utility Deposits, Fees, Permits & Licenses | $5,500 | $12,500 |
| Architects’ and Permit Expediter Fees | $15,000 | $42,000 |
| Construction Management Fee | $3,500 | $17,500 |
| Other Pre‐Construction Costs | $12,000 | $30,000 |
| Leasehold/Construction | $114,500 | $395,000 |
| Exterior Signage | $5,000 | $18,000 |
| Interior Signage | $4,000 | $9,500 |
| POS System and Software; Back Office Computer, Printer and Related Hardware and Software; Sound System; Televisions and Office Supplies | $6,000 | $8,500 |
| Equipment/Smallwares | $45,000 | $59,000 |
| Designated Furniture, Millwork and Countertops, Sneeze Guard, Trash Can Caddies & Trash Cans, Lighting Fixtures, Menu Boards & Ad Boxes, Drink Station and Beer Wall (if applicable) | $37,500 | $101,200 |
| Opening Inventory | $11,000 | $15,000 |
| Beer & Wine License Costs | $750 | $1,500 |
| Grand Opening Marketing and Promotion | $2,500 | $5,000 |
| Franchised Location (Lease Deposit/3 Months’ Rent) | $10,000 | $60,000 |
| Insurance – Liability & Workers Compensation (initial deposit) | $1,200 | $1,200 |
| Legal Fees/Organizational Expenses | $5,000 | $15,000 |
| Training Expenses (Travel and Living Expenses) | $3,500 | $5,500 |
| Initial Franchise Fee | $40,000 | $40,000 |
| Additional Funds (3 months) | $20,000 | $30,000 |
| ESTIMATED TOTAL (for a regular restaurant or Makai by LemonShark restaurant)* | $341,950 | $866,400 |
Other Costs
| Type of Fee | Amount |
|---|---|
| Royalty Fees | 6% of gross sales. |
| Marketing Fund Fees | 2% of gross sales. |
| Technology Fee | $250 monthly |
| Intranet Fee | $150 monthly |
| Local Store Marketing Expenditure | 2% of gross sales. |
| Cooperative Marketing Fees | The franchisor determines and 50% or more of the participating LemonShark restaurants in the cooperative marketing program, not exceeding 2% of gross sales. |
| Late Charge | 1.5% per month or 18% per year plus $200 |
| Pre‐Opening Additional Initial Training Fees | $2,500 per additional trainee plus expenses |
| Post‐Opening Additional Initial Training Fees | $1,000 weekly for each of the franchisor’s employees who provide post-opening additional initial training programs for franchisees, plus expenses |
| Post-Opening Additional/Remedial Training Program Daily Fee | $250 daily for each of the franchisor’s employees who provide post‐opening additional training programs, plus expenses |
| Manual Replacement Fees | $500 |
| Inspection Fees | $500 per re‐inspection. |
| Insurance | Amount of unpaid premiums and the franchisor’s out of pocket costs. |
| Transfer Fee | $10,000 |
| Renewal Fee | The greater of $5,000 or 1% of gross sales during the preceding 12 calendar months of operations. |
| Non‐Cash Payment System | All costs associated with non‐cash payment systems. |
| Default Reimbursement | The franchisor’s costs and expenses from the franchisee’s default. |
| Audit | Cost of audit plus 1.5% per month |
| Interim Management Fee | To be determined. |
| Gross‐Up Fees | Varies |
| Sanitation and Food Safety Audits | Inspection cost |
| New Product and Supplier Testing Fees | Actual cost of inspection testing; + $1000 deposit |
| Annual Conference Fee | $500 |
| Pokemobile (Food Truck) Rental Fee | $100 per day plus all costs for operation of the food truck. |
| Post‐Termination Gross Revenue Fee | 8% of all revenue derived from the operation of the competitive business. |
| Relocation Fee | $2,500 |
| Relocation Assessment | An amount equal to the royalty fees franchisees paid for their original franchised restaurant during the last preceding calendar year + 10%. |
| Private Offering Fee | $10,000 or such greater amount |
Did You Know?
- LemonShark Poke has earned a spot in Entrepreneur’s list of The Best Of: Asian Food and (#7) and the 2021 Top New Franchise Ranking (#86).
- They offer catering services to selected states: California, Florida, Illinois, Louisiana, North Carolina, New York, and Texas.
- They’ve sponsored over 1225 lbs of ocean clean-up as well.
- They have created 850+ jobs since franchising their restaurant.
Interested in other fast-casual or restaurant franchises? Check out Franchise How for other information.