iCode Franchise in 2024: Costs, Fee & FDD
Explore iCode’s dynamic approach to tech education and its growth potential. Learn about the franchise costs, competitive landscape, and support system that sets iCode apart. Read more to discover if iCode aligns with your investment goals!
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iCode, founded by Abid Abedi in September 2015, emerged from a passionate drive to revolutionize after-school education by making learning fun and engaging for children. Abedi, an immigrant who came to the U.S. with just $100, built a career in corporate America before embarking on his entrepreneurial journey. Over the past four decades, he founded over 15 companies across various industries, accumulating over $3 billion in sales. iCode, his brainchild, reflects the lessons he learned, with a focus on building a strong foundation and a welcoming, inspiring environment for children.
At its core, iCode offers programs designed to teach children coding skills, but it doesn’t stop there. Abedi recognized the importance of developing soft skills such as communication, collaboration, and presentation, which are often overlooked in traditional education. The franchise also offers ancillary programs like camps and virtual options, catering to the demands of parents and children alike. iCode’s primary customers are school-aged children and their parents, but its broader mission is to equip young learners with essential skills for future success.
Today, iCode has grown significantly, with over 40 franchises operating in 26 states across the U.S. The company continues to expand its reach, driven by a vision that includes exploring new markets and revenue streams. With a strong daily customer base, iCode has established itself as a leader in the education franchise sector. This growth is supported by a franchise system that provides robust training and ongoing support, ensuring franchisees have the tools they need to succeed.
iCode Franchise Insights
- The franchise is uniquely positioned by not only teaching coding but also emphasizing essential soft skills like communication and collaboration, setting it apart from other after-school programs.
- iCode has rapidly expanded, with over 40 franchises operating across 26 states in the U.S., reflecting the strong demand for tech education among young learners.
- iCode offers a flexible business model, including in-person and virtual classes, which caters to a broad range of customer needs and maximizes revenue potential for franchisees.
- With a strong culture that encourages employee initiative and collaboration, iCode has achieved high levels of staff satisfaction, which directly impacts the quality of education delivered to students.
iCode Franchise Key indicators
Growth YOY (%)
52%
vs industry 0%
Total U.S. Franchised Units
44
3-Year Failure Rate
12%
vs industry 10%
Sales-to-Investment ratio
1.3:1
How much does it cost to open an iCode franchise?
Understanding the potential investment size and capital requirements is crucial when considering opening an iCode franchise. These financial commitments, including initial franchise fees, equipment costs, and ongoing operational expenses, impact the feasibility and profitability of the venture. Thoroughly evaluating these factors ensures that potential franchisees are prepared for the financial responsibilities and can make informed decisions about their ability to sustain and grow the business, ultimately contributing to long-term success.
Min & Max Investment
Opening an iCode franchise involves several key costs, which are outlined in Item 7 of the Franchise Disclosure Document (FDD). You can see a breakdown of the costs to open an iCode below from the most recent Item 7 below:
| Type of Expenditure | Minimum Investment | Maximum Investment |
|---|---|---|
| Initial Franchise Fee | $35,000 | $35,000 |
| Architecture and Project Management | $16,000 | $18,000 |
| Leasehold Improvements | $90,000 | $135,000 |
| Lease Deposits | $4,000 | $10,000 |
| Furnishings | $20,000 | $24,000 |
| Glass Walls and Doors | $35,000 | $45,000 |
| Computers/IT Installation | $40,000 | $55,000 |
| Technology Fee | $1,425 | $1,425 |
| Grand Opening Advertising | $5,000 | $5,000 |
| Classroom/Office Supplies | $1,000 | $1,500 |
| Course Inventory | $13,000 | $15,000 |
| Student Supplies | $2,000 | $3,000 |
| Signage and Graphics | $12,000 | $16,000 |
| Flooring Materials | $4,000 | $6,000 |
| Insurance | $2,000 | $5,000 |
| Initial Training Program | $2,000 | $4,000 |
| Professional Fees | $1,000 | $3,500 |
| Additional Funds (3-month period) | $15,000 | $45,000 |
| Total | $298,425 | $427,425 |
Item 7 in the Franchise Disclosure Document (FDD) is the “Estimated Initial Investment” section. It outlines the total costs a franchisee can expect to incur when starting a franchise, including the initial franchise fee, equipment, inventory, real estate, and other startup expenses. This section is crucial because it provides potential franchisees with a detailed understanding of the financial commitment required, helping them assess affordability and plan their investment strategy effectively.
Required Capital
When considering opening an iCode franchise or a similar education-focused franchise, it’s important to understand the financial requirements beyond the franchise fee. Here’s a breakdown of the required capital, liquid assets, and net worth needed to get started:
- Initial Investment The total investment for iCode ranges from approximately $298,000 to $427,000. This includes expenses such as facility build-out, equipment, marketing, and initial inventory. Assuming that you will finance your franchise investment, you should plan to have 20% of the total investment amount in the form of equity (cash) for the investment.
- Liquid Assets Requirement For education franchises like iCode, you typically need to have at least $100,000 in liquid assets. This ensures you have enough cash on hand to cover ongoing operational costs and unexpected expenses during the startup phase.
- Net Worth Requirement Franchisees should generally have a net worth of at least $300,000 to $500,000. This figure is a common requirement in the education franchise industry, demonstrating your financial stability and ability to sustain the business long-term.
How much does an iCode franchise owner make?
Calculating the salary of an iCode franchise owner involves analyzing gross sales to determine total revenue, assessing operational efficiency to understand profit margins, and accounting for franchisor fees and additional expenses such as rent, utilities, and payroll. Effective management of these factors can significantly impact the profitability and financial success of an iCode franchise owner. This comprehensive financial analysis helps estimate net profits, from which the owner’s salary can be derived. A clear understanding of these factors ensures accurate salary projections and financial planning for sustainable business operations.
iCode Revenue & Gross Sales
iCode’s recent revenue performance showcases strong potential for franchisees, with the median gross sales reaching $320,005. This figure reflects the growing demand for tech education and coding programs for children. The consistent performance of iCode locations highlights the franchise’s ability to generate significant revenue, making it an attractive opportunity for those looking to invest in the booming education sector.
Which key factors impact the average revenue performance of iCode franchisees?
The strong performance of U.S. franchisee median gross sales at iCode can likely be attributed to several key factors. First, the increasing demand for STEM education, particularly coding, positions iCode as a relevant and sought-after choice for parents eager to equip their children with essential skills. The franchise’s comprehensive curriculum, which blends technical and soft skills, appeals to both parents and students, ensuring repeat business. Additionally, iCode’s flexibility in offering both in-person and virtual classes expands its reach and accessibility. The franchise’s strong support system, including extensive training and marketing, also helps franchisees effectively manage and grow their businesses, contributing to solid sales performance.
iCode Franchise Operational Costs
When opening an iCode franchise, it’s crucial to be aware of the primary ongoing operational costs that will impact your business. These expenses are essential to maintaining a successful operation and ensuring smooth day-to-day activities.
- Staff Salaries Hiring qualified instructors and administrative staff is vital, as they will be the backbone of your operations.
- Rent and Utilities Leasing a suitable location and covering utility costs will be a significant part of your monthly expenses.
- Technology Upgrades and Maintenance Regularly updating computers, software, and other tech equipment is essential to keep up with evolving educational standards.
- Curriculum and Supplies Keeping the curriculum updated and ensuring a steady supply of educational materials will contribute to ongoing costs.
Being aware of these operational costs will help you budget effectively and maintain a profitable iCode franchise. Proper management of these expenses is key to long-term success.
iCode Franchise Fees
When opening an iCode franchise, it’s important to factor in the ongoing fees associated with maintaining your business. These fees are designed to support both the franchise network and your individual location, covering essential aspects like brand development, technology, and training. Understanding these costs will help you plan your finances and ensure long-term success.
- Royalty Fee Franchisees are required to pay the greater of either a minimum royalty fee of $800 per month or 8% of gross sales. This fee contributes to ongoing support, system improvements, and access to the iCode brand’s proven business model.
- Brand Development Fee A 2% of gross sales fee is due monthly and is allocated towards national brand development, ensuring consistent marketing efforts and brand visibility across all locations.
- Local Advertising Franchisees must allocate 3% of their gross sales towards local advertising. This investment helps attract new students and reinforces your presence within the community.
- Additional Fees There are additional fees for training programs, technology, and other items provided by iCode that may be applied.
By staying on top of these fees and managing your finances effectively, you’ll be well-positioned to grow your iCode franchise and enjoy the benefits of being part of a thriving brand.
iCode Franchise Earnings
The earnings of an iCode franchise owner can vary depending on several factors such as location, student enrollment, and how efficiently the franchise is managed. However, based on recent data, the median gross sales for an iCode franchise are approximately $320,005. For owner-operators who are actively involved in the daily operations, the estimated earnings are around $38,000, reflecting an operating profit margin of 12%.
Active, hands-on management by the franchise owner can lead to better financial outcomes, as the owner’s direct involvement often translates into improved operational efficiency and customer satisfaction. While these figures provide a solid benchmark, it’s important to note that actual earnings can differ depending on how effectively the business is run and how well the franchise adapts to its local market. Overall, iCode offers a promising opportunity for those who are dedicated to both education and entrepreneurship.
How to Open an iCode Franchise
Becoming an iCode franchisee involves a structured process designed to ensure that both you and the franchise are set up for success. From the initial inquiry to the grand opening, each step is crucial in establishing a thriving iCode location.
- Initial Inquiry You or your franchise specialist submits an initial inquiry basic information about your interest and background. You should also conduct thorough research on the franchise, including seeing all of the information available on the Vetted Biz franchise intelligence platform, including access to the most recent Franchise Disclosure Document (FDD).
- Franchise Application After the initial contact, you’ll be asked to complete a detailed franchise application. This allows iCode to assess your qualifications, financial readiness, and alignment with their values.
- Discovery Day Attend an iCode Discovery Day, where you’ll visit a campus, meet the leadership team, and get a firsthand look at the franchise’s operations. This is an opportunity to ensure the franchise is a good fit for you.
- Franchise Agreement Signing If both parties are ready to move forward, you’ll sign the franchise agreement, officially becoming an iCode franchisee. This step includes finalizing financial arrangements and preparing for the next phase.
- Site Selection and Build-Out Work with iCode’s real estate team to find an ideal location for your franchise. Once the site is selected, you’ll begin the build-out process, adhering to iCode’s design and operational standards.
- Training Program Participate in an extensive training program that covers everything from curriculum delivery to business management. This training is essential for getting you up to speed on running your iCode franchise.
- Pre-Opening Marketing Before your grand opening, you’ll engage in local marketing efforts to build awareness and attract students to your new iCode campus.
- Grand Opening With everything in place, your iCode campus will open its doors to the community, marking the start of your operations. Ongoing support from the franchise team will help you navigate the early stages of your business.
Pros & Cons
Pros
High-Demand Market: iCode operates in the rapidly growing STEM education sector, offering coding and technology programs that are increasingly in demand as parents and schools focus on preparing children for the future.
Proven Business Model: With over 40 locations across the U.S., iCode has a well-established business model that has been successful in various markets, giving franchisees a strong foundation to build upon.
Multiple Revenue Streams: In addition to regular classes, iCode offers camps, workshops, and virtual programs, giving franchisees various ways to generate revenue year-round.
Cons
Competitive Market: The education and tutoring industry is competitive, with various coding and STEM education providers available. Standing out in a crowded market may require extra effort and investment in local marketing and community engagement.
Complex Operations: Running an iCode franchise involves managing a mix of educational programs, instructors, and technology, which can be challenging for those without prior experience in education or technology management.
Labor-Intensive: Hiring, training, and retaining qualified instructors who can deliver the iCode curriculum effectively can be a demanding task, especially in regions with a competitive job market.
Evolving Industry: The tech and education sectors are rapidly evolving, requiring ongoing updates to curriculum and teaching methods. Keeping up with these changes may require additional investment in training and resources.
