Dog Training Elite Franchise Poised For Success (2022)
Dog Training Elite provides professional dog training services with unique tailored programs to meet each dog’s unique situations. The co-founder has been in the pet industry for nearly 50 years!
In 1976, Founder John Mestas opens Arrow Kennels, named after his first obedience trial dog, a golden retriever named Arrow.
In 1990, Arrow Kennels opened its dog training services and this quickly became the most profitable aspect of the business. John witnesses the strong demand for dog training services, and the great economics ($) of dog training.
In 2011, Arrow Kennels officially became Dog Training Elite and in 2014 they awarded its first regional franchise before bringing it nationwide.
Kelley Rosequist and John Mestas founded the franchise system and are the current CEOs. At the close of 2021, they had 84 franchised units.
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How is Dog Training Elite Franchise Positioned in the Pet Care Industry?
The pet care industry encompasses businesses that offer grooming, boarding, and training services for household pets, primarily canine and feline pets. Three of the biggest contenders in this market are Aussie Pet Mobile Inc., Camp Bow Wow, and Best Friends Pet Care Inc, but none owns more than 5% of the market share, resulting in a highly fragmented market. The industry brings in $8.4billion in revenue annually, with profits of $952million. It is expected to have an annual growth rate of 2.7% between 2022 and 2027.
How Much is a Dog Training Elite Franchise?
The initial Dog Training Elite Franchise Fee is $59,000. You have to pay this upfront fee when opening a Dog Training Elite franchise.
Dog Training Elite Franchise Cost
| Type of Expenditure | Low Amount | High Amount | To Whom Payment Is To Be Made |
|---|---|---|---|
| Initial Franchise Fee | $59,000 | $59,000 | Us |
| Travel, lodging, food and other expenses while training | $1,500 | $10,000 | Us and airlines, hotels and restaurants |
| Real estate and Improvements | $0 | $0 | Not applicable |
| Start-up packet | $500 | $1,100 | Us or affiliates |
| Additional equipment and mobile device | $500 | $3,000 | Suppliers |
| Vehicle wrap | $3,500 | $5,000 | Suppliers |
| Banners and signs | $750 | $3,000 | Suppliers |
| Misc. opening costs | $1,500 | $4,500 | Suppliers, government departments, utilities, etc. |
| Marketing – 3 months | $2,000 | $3,000 | Suppliers |
| Additional Funds – 3 months | $22,150 | $23,650 | Us, suppliers, accountants, employees, etc. |
| TOTAL | $91,400 | $112,250 |
The estimated total investment necessary to begin the operation of a Dog Training Elite Franchise ranges from $91,400 to $112,250. The following costs are part of the upfront costs included in the initial investment for a Dog Training Elite. Many of these are one-time fees that you need in order to launch the franchise. Review the chart below to see how much it costs to buy a Dog Training Elite franchise in 2022.
This is lower than the industry average of $271,000 per franchise.
Dog Training Elite Franchise Requirements
Dog Training Elite vets prospective franchisors based on their answers to their Franchise Ownership Questionnaire
Owning a Dog Training Elite Franchise Requires Ongoing Fees
Royalty: 8% of Gross sales
Brand Fund Fee: 1% of Gross sales
Online Advertising Fee: $500 per month
How much do Dog Training Elite franchise owners make?
| Franchise 1 | % of Gross | Affiliate 1 | % of Gross | Affiliate 2 | % of Gross | |
|---|---|---|---|---|---|---|
| Gross Sales | $534,164.28 | 100% | $807,028 | 100% | $1,196,755 | 100% |
| Cost of Goods Sold | ($56,767) | 10.63% | ($38,471) | 4.77% | ($187,284) | 15.65% |
| Advertising and Promotion | ($32,208) | 6.03% | ($37,267) | 4.62% | ($231,852) | 19.37% |
| Automobile Expenses | ($18,986) | 3.55% | ($40,128) | 4.97% | ($55,907) | 4.67% |
| Wages & Payroll | ($99,392) | 18.61% | ($226,003) | 28.00% | ($309,137) | 25.83% |
| Owners Salary | ($116,918) | 21.89% | ($59,669) | 7.39% | $0 | 0.00% |
| Travel Expenses | ($2,134) | 0.40% | $0 | 0% | ($5,218) | 0.44% |
| Franchise Royalties | ($52,580) | 9.84% | ($114,259) | 14.16% | ($38,131) | 3.19% |
| Utilities | ($2,287) | 0.43% | ($14,229) | 1.76% | ($22,221) | 1.86% |
| Office Expenses | ($212) | 0.04% | ($16,620) | 2.06% | ($135,034) | 11.28% |
| Supplies | ($3,796) | 0.71% | ($3,712) | 0.46% | ($725) | 0.06% |
| Insurance | ($6,921) | 1.30% | ($14,338) | 1.78% | ($18,095) | 1.51% |
| Meals and Entertainment | ($2,682) | 0.50% | ($20,188) | 2.50% | ($9,116) | 0.76% |
| Professional Fees | ($236) | 0.04% | ($2,233) | 0.68% | $0 | 0% |
| Dues and Subscriptions | ($1,041) | 0.19% | ($521) | 0.06% | ($13,656) | 1.14% |
| Veterinary Care | ($1,859) | 0.35% | ($1,913) | 0.24% | ($3,940) | 0.33% |
| Rent | ($9,061) | 1.70% | ($57,477) | 7.12% | ($26,981) | 2.25% |
| Miscellaneous Expenses | ($846) | 0.16% | ($10,127) | 1.25% | ($11,031) | 0.92% |
| Total Operating Expenses | ($407,926) | 76.37% | ($657,155) | 81.38% | ($1,068,328) | 89% |
| Net Profit | $106,644 | 35.10% | $105,816 | 18.62% | $128,427 | 11% |
Detailed profit and loss information for the 2 affiliate-owned outlets and our 1 franchise outlet that had been opened for at least 3 years during the 2021 reporting period. Every other franchise in the system was opened for less than 3 years during the 2021 reporting period.
Gross sales of all franchises that operated for all of the 2021 calendar year
| Franchise 1 | Franchise 2 | Franchise 3 | Franchise 4 | Franchise 5 | |
|---|---|---|---|---|---|
| Gross Sales | $534,164 | $366,083 | $951,566 | $169,071 | $207,387 |
| Franchise 6 | Franchise 7 | Franchise 8 | Franchise 9 | |
|---|---|---|---|---|
| Gross Sales | $478,613 | $145,618 | $182,758 | $320,051 |
Gross sales are all over the place for Dog Training Elite franchises. This is probably reflective of the maturity of the business as depicted in Table 4 it can take time to grow the book of business.
| Franchise 1 | Affiliate 1 | Affiliate 2 | ||||
|---|---|---|---|---|---|---|
| Year | Gross Sales | % Difference From Prior Year | Gross Sales | % Difference From Prior Year | Gross Sales | % Difference From Prior Year |
| 2019 | $354,600 | 159.60% | $362,309 | 38.40% | $507,351 | 4.20% |
| 2020 | $304,594 | -14% | $568,641 | 56.90% | $1,484,942 | 192.70% |
| 2021 | $534,164 | 175% | $807,028 | 141.92% | $1,196,755 | -19.41% |
Is the Dog Training Elite Franchise Profit Worth the Franchise Cost?
To assign a valuation multiple for Dog Training Elite franchises, we leverage estimates from DealStats, a database of acquired private company transactions sourced from U.S. business brokers and SEC filings. We reviewed the larger franchise industry as well as selling price multiples for larger systems where more transaction data is available.
Under $1 Million Net Sales
- Estimated Selling Price = Net Sales – 0.55
$1 Million – $5 Million Net Sales
- Estimated Selling Price = Net Sales – 0.90
Over $5 Million Net Sales
- Estimated Selling Price = N/A
When you go to sell a Dog Training Elite franchise in year 5 based on the median multiple of .55 and net sales of $845,000 it would sell for $464,500. This is significantly higher than the midpoint investment of $101,825.
Dog Training Elite (Franchisor) Income Statement Key Insights:
For the years ended December 31, 2021, 2020, and 2019
| 2021 | 2020 | 2019 | |
|---|---|---|---|
| Operating revenue | |||
| Royalties | $328,419 | $336,858 | $299,953 |
| Initial franchise fees | 619,508 | 23,142 | – |
| Service revenue | 233,928 | – | – |
| Product sales | 73,658 | 49,210 | 40,721 |
| Total revenue | 1,255,513 | 409,210 | 340,674 |
| Cost of goods sold | 540,058 | 190,144 | 139,513 |
| Gross profit | 715,455 | 219,066 | 201,161 |
| Operating expenses | |||
| General and administrative | 472,853 | 158,761 | 158,981 |
| Professional fees | 64,863 | 18,444 | 16,907 |
| Advertising and promotional | 126,932 | 49,742 | 27,845 |
| Total operating expenses | 664,648 | 226,947 | 203,733 |
| Net income (loss) | $50,807 | $(7,881) | $(2,572) |
Dog Training Elite is on track to become a profitable business for the franchisor with retained earnings of $50,000 in 2021. Compared to a loss of $2,000 in 2019, Pet Training Elite made profits in 2021.
How many Dog Training Elite units have opened and closed?
System-wide Territory Summary
| Outlet type | Year | Territories at the Start of the Year | Territories at the End of the Year | Net Change |
|---|---|---|---|---|
| Franchised | 2019 | 5 | 5 | +0 |
| 2020 | 5 | 26 | +21 | |
| 2021 | 26 | 84 | +58 | |
| Company-Owned | 2019 | 10 | 10 | +0 |
| 2020 | 10 | 10 | +0 | |
| 2021 | 10 | 10 | +0 | |
| Total Territories | 2019 | 15 | 15 | +0 |
| 2020 | 15 | 36 | +21 | |
| 2021 | 36 | 94 | +58 |
Over the last three years, the company has been expanding. Franchised units have increased. Over the last two years, franchises have opened at a rate of 40 units a year. This is an indicator that these stores might be performing well and the business is getting off the ground. It is vital to track the financial performance of the new franchises to see if they reflect net profit above $100,000.
Conclusion
Dog Training Elite offers the opportunity to join an industry that is not going to die soon. The business concept is compelling but the financials still need to be proven beyond the three locations reported in ITEM 19 from the 2022 FDD.
While this may be the business for you, make sure also to check out other businesses offered on Vetted Biz and in the Pet Care Industry.
