Risk Score
Pending analysis
Investment Range
$337,050 - $430,500
Franchise Fee
$15,000
Min Cash Required
$40,000
Total US Locations
34
Business Summary
Music Go Round operates retail stores where franchisees sell quality used and new musical instruments, speakers, amplifiers, music-related electronics, and related accessories. Music Go Round emphasizes offering value through used merchandise at significant savings and by purchasing used goods from customers. Stores also provide new merchandise to complement the used selection.
Corporate History
Winmark Corporation was originally incorporated in Minnesota on July 20, 1988, under the name Play It Again Sports Franchise Corporation. The company's corporate name changed to Grow Biz International, Inc. in July 1993, and then to Winmark Corporation in November 2001. Music Go Round has been offering franchises since March 1994. Winmark Corporation also franchises four other retail concepts: Play It Again Sports, Once Upon A Child, Plato's Closet, and Style Encore. Historically, Winmark also offered franchises for Disc Go Round, It's About Games, Computer Renaissance, ReTool, and Wirth Business Credit, which are no longer offered.
Financial Overview
Investment Range
$337,050 - $430,500
Franchise Fee (Low)
$15,000
Franchise Fee (High)
$25,000
Minimum Cash Required
$40,000
Royalty %
4%
Marketing %
5%
Equipment Costs (Low)
$94,550
Equipment Costs (High)
$133,000
Working Capital
$45,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Music Go Round's financial condition raises questions about the franchisor's ability to provide services and support to franchisees. As reflected in its financial statements, Winmark Corporation has a negative total shareholders' equity (deficit) of approximately $51 million as of December 28, 2024, which indicates a challenging financial position.
Financing Details
Music Go Round does not offer any direct or indirect financing to its franchisees. Additionally, Music Go Round does not guarantee any notes, leases, or obligations for its franchisees.
Performance Metrics
Total US Locations
34
Franchised Units
34
Corporate Units
0
Avg Square Footage
3,500
Franchising Since
1994
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Music Go Round has no litigation history to report as of the issuance date of this FDD.
Bankruptcy History
Music Go Round has no bankruptcy history to report.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their Music Go Round franchise, franchisees must provide advance written notice, sign the then-current Franchise Agreement, pay a renewal fee of $10,000, remodel their store to meet current brand standards, secure an extension of their lease, and be in full compliance with the Franchise Agreement during its term. Franchisees should be aware that the new Franchise Agreement may contain materially different terms and conditions, including royalty rates and advertising contributions, and an altered Exclusive Territory, and may not contain any further rights of renewal.
Training & Support Program
Franchisor Assistance
Music Go Round provides comprehensive assistance to its franchisees. Before opening, this includes help with site selection and lease issues, specifications for store layout and design, and a list of standard fixtures, equipment, supplies, and initial inventory. Franchisees attend a mandatory three-part training program covering general business issues, store operations, and hands-on in-store experience. Music Go Round also provides confidential Operations Manuals, assists in business plan development, and offers pre-opening and store opening assistance. Ongoing support includes periodic evaluations and written reports from field consultants, advisory services on store operations, updates to the Business System and Manuals (available on the brand extranet site), and the development of advertising and marketing materials.
Initial Training Hours
77
Training Location
Minneapolis, MN, online, and at selected existing Music Go Round stores.
Ongoing Support
Music Go Round provides ongoing support to its franchisees through field consultants who conduct periodic evaluations of stores and provide written reports to assist with operations. Upon a franchisee's written request, advisory services relating to store operations are available. Music Go Round also periodically makes available all changes, improvements, and additions to the Business System, along with updated and revised confidential Manuals, which are accessible on the brand extranet site. Additionally, Music Go Round develops advertising and marketing materials for franchisee use.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Full-Time
Territory Type
Exclusive
Territory Size Requirements
Music Go Round defines its exclusive territories using computer-modeled mapping that considers population density, average household income, and consumer traffic patterns. Territories typically span a 3 to 5-mile radius around the store. For stores in urban areas with populations over 250,000, the exclusive territory generally has a minimum population of 75,000 to 100,000 people. In all other areas, the exclusive territory generally has a minimum population of 50,000 people.
Staffing Notes
Music Go Round requires that a designated management person always be on duty when the store is open for business, responsible for daily operations. Franchisees must hire and maintain a sufficient number of adequately trained and competent employees to ensure efficient customer service. Employee management is also a specific topic covered during the initial training program.