Smile Source Franchise Opportunity for 2024
Smile Source franchises operate a dental office, in a specific territory, for routine dental treatments, conducting examinations to diagnose extensive implants and cosmetic and orthodontic elective health problems. They use corrective tooth loss and esthetic measures such as dental prosthetic implant replacements or orthodontic and cosmetic corrections and provide all other areas of dental care
How Much Is a Smile Source Franchise?
The initial Smile Source Franchise Fee is $0. You do not have to pay an upfront fee.
Smile Source Franchise Cost
The estimated total investment necessary to begin the operation of a Smile Source franchise ranges from $60,500 to $435,000. The following costs are part of the upfront costs included in the initial investment. Many of these are one-time fees that are needed to launch the franchise. Review the chart below to see how much it costs to buy a Smile Source franchise in 2022.
| Type of expediture | Amount | To Whom Payment Is To Be Made |
|---|---|---|
| Initial Franchise Fee | None | |
| Architectural % Miscellaneous Site Improvement Changes | $5,000 to $300,000 | Vendors |
| Leasing of Dental Care Center (deposit and first month’s rent) | $2,500 to $6,000 | Landlord |
| Signage | $3,000 to $10,000 | Suppliers |
| Legal Fees | $800 to $1,200 | Attorneys |
| Initial Inventories (Dental Supplies) | $20,000 to $8,000 | Vendors |
| Point of Sale Computer & Accounting Set-Up | $2,000 to $8,000 | Vendors and Accounting Professional |
| Office Equipment and Furniture | $2,000 to $10,000 | Suppliers |
| Prepaid Expenses and Deposits | $2,000 to $3,000 | Vendors & Utilities |
| Practice Development Expenses | $2,000 to $5,000 | Suppliers |
| Insurance (initial premium) | $1,200 to $1,800 | Insurance Company |
| Additional Funds – 3 Months | $20,000 to $50,000 | Employees, Vendors & Sippliers |
| TOTAL | $60,500 to $435,000 |
Ongoing Fees
Royalty: Up to 2.00% of Gross Receipts, but currently 1.45% for new franchisees
Registration Fee for Attendees at Annual Meeting: A registration fee for attendance at the annual meeting is charged. For the 2022 annual meeting, the registration fee is $750 per person; i.e., dentists, associates, staff members, and family members. The fee covers meals for all paid attendees. The registration fee is subject to change by Smile Source.
Franchisor Income Statement Key Insights
Smile Source does not disclose its financials, instead saying, “Our separate financial statements as of December 31, 2021, 2020 and 2019 are not included in this disclosure document. Should we fail to fulfill our duties and obligations to our franchisees under their franchise agreements, however, Smile Source Marketing, Inc. absolutely and unconditionally guarantees to assume those duties and obligations.”
It is concerning that they do not disclose this information.
How Many Smile Source Units Have Opened and Closed?
| Outlet type | Year | Outlets at the Start of the Year | Outlets at the End of the Year | Net Change |
|---|---|---|---|---|
| Franchised | 2019 | 623 | 764 | 111 |
| 2020 | 734 | 594 | -140 | |
| 2021 | 594 | 625 | 31 | |
| Company-Owned | 2019 | 0 | 0 | 0 |
| 2020 | 0 | 0 | 0 | |
| 2021 | 0 | 0 | 0 | |
| Total Outlets | 2019 | 623 | 734 | 111 |
| 2020 | 734 | 594 | -140 | |
| 2021 | 594 | 625 | 31 |
Over the last three years, the company has seen a lot of turbulence.
Over the last three years, franchises have opened at an average rate of under 1 unit a year. This is an indicator that these stores may not be performing well.
Or their franchise term is up and they are not renewing it. This figure, however, comes from data revealing that in 2020, 140 franchisees closed shop altogether and the number of franchises dropped from 734 to 594.
Smile Source is also on our franchise failure rate list where it is ranked #43, with 225 failures in the 2017-2019 time period.
Conclusion
As a Smile Source franchisee, you will have the opportunity to operate your own dental office in a specific territory. The initial investment for a Smile Source franchise ranges from $60,500 to $435,000, and there is no upfront franchise fee required.
Ongoing fees for a Smile Source include a royalty of up to 2% of gross receipts, currently set at 1.45% for new franchisees, and a registration fee for attendance at the annual meeting, currently set at $750 per person.
While Smile Source has not disclosed its financials, data shows that 140 franchisees closed in 2020, leading to a drop in the number of franchises from 734 to 594. Additionally, this brand has a high failure rate, ranking #43 with 225 failures in the 2017-2019 time period. It is important to carefully consider these factors before deciding if a Smile Source franchise is the right opportunity for you.
While this may be the business for you, make sure to also check out other companies offered on Vetted Biz and in the Medical industry.
