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Challenge Island Franchise Review (2021)

Written by: Patrick Findaro
Last Updated by Catalina Lima: August 22, 2022
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Challenge Island

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.

challenge island

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 TypesAmount (in USD)When DueTo Whom Payment is to Be Made
LowHigh
Franchise Fee30.00030.000Upon signing FAFranchisor
Equipment01.00030 Days Prior to OperatingThird Parties
Product / Supplies20050030 Days Prior to OperatingThird Parties
Insurance Premium2002.000One Week Before Commencement of OperationsInsurance Agent
Office & Printing Supplies2008005 Days Prior to Commencement of OperationsSuppliers
Professional Fees5001.000As RequiredProfessionals
Training Expenses5002.000As RequiredAirlines, Hotels, and Restaurants
Marketing Materials05005 Days Prior to Commencement of OperationsSupplier
Business License50200As RequiredGovernmental Licensor
Initial Marketing Plan3001.000As IncurredAdvertising Suppliers
Franchise Management Tool2502505 Days Prior to Commencement of OperationsThird Party
Real Estate and ImprovementsN/AN/ANot RequiredNot Required
Additional Funds (3 months)4.00010.000As IncurredThird Parties

One territorie

Cost TypesAmount (in USD)When DueTo Whom Payment is to Be Made
LowHigh
Franchise Fee$39.900$39.900Upon signing FAFranchisor
Equipment1.5001.50030 Days Prior to OperatingThird Parties
Product / Supplies50050030 Days Prior to OperatingThird Parties
Lease / Office Space6.00024.000Before OpeningLandlord
Insurance Premium7001.000One Week Before Commencement of OperationsInsurance Agent
Office & Printing Supplies1.0001.5005 Days Prior to Commencement of OperationsSuppliers
Professional Fees3.0004.000As RequiredProfessionals
Training Expenses2.0003.000As RequiredAirlines, Hotels, and Restaurants
Marketing Materials1.0001.5005 Days Prior to Commencement of OperationsSupplier
Business License100500As RequiredGovernmental Licensor
Initial Marketing Plan1.0003.000As IncurredAdvertising Suppliers
Franchise Management Tool2502505 Days Prior to Commencement of OperationsThird Party
Security Deposit for Real Estate500700As RequiredLandlord
Manager Salary12.00018.000As RequiredEmployee
Car (Small SUV or Bigger)8.00030.000As RequiredThird Parties
Additional Funds (3 months)5.00010.000As IncurredThird Parties
Total$82,450$139,350

Two territories

Cost TypesAmount (in USD)When DueTo Whom Payment is to Be Made
LowHigh
Franchise Fee$54.000$54.000Upon signing FAFranchisor
Equipment2.0002.00030 Days Prior to OperatingThird Parties
Product / Supplies1.0001.00030 Days Prior to OperatingThird Parties
Lease / Office Space6.00024.000Before OpeningLandlord
Insurance Premium7001.000One Week Before Commencement of OperationsInsurance Agent
Office & Printing Supplies1.5002.0005 Days Prior to Commencement of OperationsSuppliers
Professional Fees3.0004.000As RequiredProfessionals
Training Expenses2.0003.000As RequiredAirlines, Hotels, and Restaurants
Marketing Materials1.5002.0005 Days Prior to Commencement of OperationsSupplier
Business License100500As RequiredGovernmental Licensor
Initial Marketing Plan1.0003.000As IncurredAdvertising Suppliers
Franchise Management Tool2502505 Days Prior to Commencement of OperationsThird Party
Security Deposit for Real Estate500700As RequiredLandlord
Manager Salary12.00018.000As RequiredEmployee
Car (Small SUV or Bigger)8.00030.000As RequiredThird Parties
Additional Funds (3 months)5.00010.000As IncurredThird Parties
Total$98,550$155,450

Non E-2

Cost TypesAmount (in USD)When DueTo Whom Payment is to Be Made
LowHigh
Franchise Fee$39.900$39.900Upon signing FAFranchisor
Equipment01.00030 Days Prior to OperatingThird Parties
Product / Supplies20050030 Days Prior to OperatingThird Parties
Insurance Premium2002.000One Week Before Commencement of OperationsInsurance Agent
Office & Printing Supplies2008005 Days Prior to Commencement of OperationsSuppliers
Professional Fees2.0004.000As RequiredProfessionals
Training Expenses5002.000As RequiredAirlines, Hotels, and Restaurants
Marketing Materials05005 Days Prior to Commencement of OperationsSupplier
Business License50500As RequiredGovernmental Licensor
Initial Marketing Plan3001.000As IncurredAdvertising Suppliers
Franchise Management Tool2502505 Days Prior to Commencement of OperationsThird Party
Additional Funds (3 months)4.00010.000As IncurredThird 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 Operation12th Month Revenue% of Stores Exceeding Average For The Category
Lowest 20% (7 stores)$7.69843%
Average (33 Stores)$13.12945%
Top 20% (7 stores)$18.20857%

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