Challenge Island Franchise Review (2021)
Written by: Patrick Findaro
Last Updated by Catalina Lima: August 22, 2022
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This article is based on its 2019 FDD
Established in 2003, Challenge Island is a one of a kind enrichment program on the cutting edge of S.T.E.A.M (Science, Technology, Engineering, Art and Math) Education and 21st Century Learning. Their unique collaborative learning approach simultaneously addresses the needs of both the child of today and the adult of the future.
Challenge Island Franchise Background
Profit Centers include Afterschool Classes, In-School Workshops, Outsourced STEAM Curriculum, Camps, Family Challenge Nights, Birthday Parties, Scout Events, Challenge Island Junior and Challenge Island Senior.
Flexible business model that allows franchisee to set own schedule and scale as they see fit.
The business is relatively low investment and cost as the schools themselves or local community areas are used for the courses, thereby reducing the investment amount.
Management Team
Challenge Island is lead by a very experienced and lean management team, led by Sharon Estroff who is the founder and creator of the Challenge Island™ program. She is an award-winning elementary school teacher with two decades of experience in Atlanta public and private schools. She started Challenge Island in her second grade classroom and began running it as an enrichment business using the current model in 2003
Sharon is a nationally recognized parenting and education expert and a freelance writer for numerous national publications including Scholastic Parent and Child, Parents, Woman’s Day and Good Housekeeping magazines. She is the author of the popular parenting book, Can I Have a Cell Phone for Hanukkah? She is sought-after speaker who has presented to scores of communities nationwide about the trials and tribulations of raising kids in the digital age.
She continues to run her local challenge island business in atlanta, georgia where she lives with her husband and four children
Franchise Education Program Industry Analysis
Franchise Strengths
- Currently the leader in this educational space
- Very low investment level
- Operationally simple, easy to learn as the franchisor provides the lessons and course plans
- Extremely low cost – majority of incurred costs only happen during a program or lesson
- Necessary in all regions and school districts of the U.S.
Franchise Weaknesses
- Lesson plans are currently dependent upon corporate, driven largely by the founder and CEO of the franchise
- Success is dependent upon capability to enter different schools
- Need to find instructors, typically teachers or retired teachers, with the right “fit” for the program
Franchise Opportunities
- STEAM courses are increasingly sought after as the importance of the skillset is deemed more in demand. Government programs even provide funding for such programs
- Ability to adapt and grow with an emerging franchisor in an under-penetrated market
- Territories available all over the U.S.
- Chance to fulfill a market niche not currently being adequately addressed
Franchise Threats
- Inability to continue to adapt to the ever-changing educational new best-practices and landscape
- Other “outside of the classroom” educational programs entering your school
- Possibility to compete directly with school-sponsored programs
How Much Is A Challenge Island Franchise?
Challenge Island Franchise cost ranges from $36,200 to $49,250 according to the 2019 FDD.
| Cost Types | Amount (in USD) | When Due | To Whom Payment is to Be Made | |
| Low | High | |||
| Franchise Fee | 30.000 | 30.000 | Upon signing FA | Franchisor |
| Equipment | 0 | 1.000 | 30 Days Prior to Operating | Third Parties |
| Product / Supplies | 200 | 500 | 30 Days Prior to Operating | Third Parties |
| Insurance Premium | 200 | 2.000 | One Week Before Commencement of Operations | Insurance Agent |
| Office & Printing Supplies | 200 | 800 | 5 Days Prior to Commencement of Operations | Suppliers |
| Professional Fees | 500 | 1.000 | As Required | Professionals |
| Training Expenses | 500 | 2.000 | As Required | Airlines, Hotels, and Restaurants |
| Marketing Materials | 0 | 500 | 5 Days Prior to Commencement of Operations | Supplier |
| Business License | 50 | 200 | As Required | Governmental Licensor |
| Initial Marketing Plan | 300 | 1.000 | As Incurred | Advertising Suppliers |
| Franchise Management Tool | 250 | 250 | 5 Days Prior to Commencement of Operations | Third Party |
| Real Estate and Improvements | N/A | N/A | Not Required | Not Required |
| Additional Funds (3 months) | 4.000 | 10.000 | As Incurred | Third Parties |
One territorie
| Cost Types | Amount (in USD) | When Due | To Whom Payment is to Be Made | |
| Low | High | |||
| Franchise Fee | $39.900 | $39.900 | Upon signing FA | Franchisor |
| Equipment | 1.500 | 1.500 | 30 Days Prior to Operating | Third Parties |
| Product / Supplies | 500 | 500 | 30 Days Prior to Operating | Third Parties |
| Lease / Office Space | 6.000 | 24.000 | Before Opening | Landlord |
| Insurance Premium | 700 | 1.000 | One Week Before Commencement of Operations | Insurance Agent |
| Office & Printing Supplies | 1.000 | 1.500 | 5 Days Prior to Commencement of Operations | Suppliers |
| Professional Fees | 3.000 | 4.000 | As Required | Professionals |
| Training Expenses | 2.000 | 3.000 | As Required | Airlines, Hotels, and Restaurants |
| Marketing Materials | 1.000 | 1.500 | 5 Days Prior to Commencement of Operations | Supplier |
| Business License | 100 | 500 | As Required | Governmental Licensor |
| Initial Marketing Plan | 1.000 | 3.000 | As Incurred | Advertising Suppliers |
| Franchise Management Tool | 250 | 250 | 5 Days Prior to Commencement of Operations | Third Party |
| Security Deposit for Real Estate | 500 | 700 | As Required | Landlord |
| Manager Salary | 12.000 | 18.000 | As Required | Employee |
| Car (Small SUV or Bigger) | 8.000 | 30.000 | As Required | Third Parties |
| Additional Funds (3 months) | 5.000 | 10.000 | As Incurred | Third Parties |
| Total | $82,450 | $139,350 |
Two territories
| Cost Types | Amount (in USD) | When Due | To Whom Payment is to Be Made | |
| Low | High | |||
| Franchise Fee | $54.000 | $54.000 | Upon signing FA | Franchisor |
| Equipment | 2.000 | 2.000 | 30 Days Prior to Operating | Third Parties |
| Product / Supplies | 1.000 | 1.000 | 30 Days Prior to Operating | Third Parties |
| Lease / Office Space | 6.000 | 24.000 | Before Opening | Landlord |
| Insurance Premium | 700 | 1.000 | One Week Before Commencement of Operations | Insurance Agent |
| Office & Printing Supplies | 1.500 | 2.000 | 5 Days Prior to Commencement of Operations | Suppliers |
| Professional Fees | 3.000 | 4.000 | As Required | Professionals |
| Training Expenses | 2.000 | 3.000 | As Required | Airlines, Hotels, and Restaurants |
| Marketing Materials | 1.500 | 2.000 | 5 Days Prior to Commencement of Operations | Supplier |
| Business License | 100 | 500 | As Required | Governmental Licensor |
| Initial Marketing Plan | 1.000 | 3.000 | As Incurred | Advertising Suppliers |
| Franchise Management Tool | 250 | 250 | 5 Days Prior to Commencement of Operations | Third Party |
| Security Deposit for Real Estate | 500 | 700 | As Required | Landlord |
| Manager Salary | 12.000 | 18.000 | As Required | Employee |
| Car (Small SUV or Bigger) | 8.000 | 30.000 | As Required | Third Parties |
| Additional Funds (3 months) | 5.000 | 10.000 | As Incurred | Third Parties |
| Total | $98,550 | $155,450 |
Non E-2
| Cost Types | Amount (in USD) | When Due | To Whom Payment is to Be Made | |
| Low | High | |||
| Franchise Fee | $39.900 | $39.900 | Upon signing FA | Franchisor |
| Equipment | 0 | 1.000 | 30 Days Prior to Operating | Third Parties |
| Product / Supplies | 200 | 500 | 30 Days Prior to Operating | Third Parties |
| Insurance Premium | 200 | 2.000 | One Week Before Commencement of Operations | Insurance Agent |
| Office & Printing Supplies | 200 | 800 | 5 Days Prior to Commencement of Operations | Suppliers |
| Professional Fees | 2.000 | 4.000 | As Required | Professionals |
| Training Expenses | 500 | 2.000 | As Required | Airlines, Hotels, and Restaurants |
| Marketing Materials | 0 | 500 | 5 Days Prior to Commencement of Operations | Supplier |
| Business License | 50 | 500 | As Required | Governmental Licensor |
| Initial Marketing Plan | 300 | 1.000 | As Incurred | Advertising Suppliers |
| Franchise Management Tool | 250 | 250 | 5 Days Prior to Commencement of Operations | Third Party |
| Additional Funds (3 months) | 4.000 | 10.000 | As Incurred | Third Parties |
| Total | $47,600 | $62,450 |
How Much does a Challenge Island Franchise make?
| Average Sales of Different Categories of Cash Plus Stores During 12th Month of Operation | 12th Month Revenue | % of Stores Exceeding Average For The Category |
| Lowest 20% (7 stores) | $7.698 | 43% |
| Average (33 Stores) | $13.129 | 45% |
| Top 20% (7 stores) | $18.208 | 57% |
