What were the capital contributions for Afuri Ramen Dumpling?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
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2 PAYMENT OF FEES AND OTHER FINANCIAL REQUIREMENTS
2.1 Initial Franchise Fee. The Initial Franchise Fee is $45,000. Contemporaneously with the execution of this Agreement, you have paid to us the entire Initial Franchise Fee. The Initial Franchise Fee is paid in consideration of our sales expenses, administrative overhead, return on investment, and start-up costs related to the execution of this Agreement and the opening of the Franchise and for our lost or deferred opportunity to sell franchises in the Franchise Territory to others.
Except as provided in Sections 3.1, none of the Initial Franchise Fee is refundable.
- 2.2 Royalty Fee. You will pay to us 5% of your Revenue (as defined in Section 2.6) each month for the preceding month as a "Royalty Fee". The precise timing and method of payment for the Royalty Fee will be as described in our Operations Manual.
- 2.3 Advertising Fee. You will pay to us 1% of your total Revenue (as defined in Section 2.6) each month for the preceding month as an "Advertising Fee". The precise timing and method of payment for the Royalty Fee will be as described in our Operations Manual.
- 2.3.1 Advertising Fee payments are in addition to and exclusive of any sums that you may decide to spend on local advertising and promot
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to the 2024 Afuri Ramen Dumpling FDD, the initial franchise fee is $45,000. This fee is due when the franchise agreement is executed. Afuri Ramen Dumpling specifies that this initial fee compensates them for sales expenses, administrative overhead, return on investment, and start-up costs related to opening the franchise, as well as the lost opportunity to sell franchises to others in the same territory.
In addition to the initial franchise fee, Afuri Ramen Dumpling franchisees must pay an ongoing royalty fee of 5% of their monthly revenue. Franchisees are also required to pay an advertising fee of 1% of their total monthly revenue. These fees contribute to the franchisor's ongoing support and brand development efforts.
The FDD also outlines Afuri Ramen Dumpling's rights to establish price ceilings or minimum/maximum allowable prices for the products and services offered by franchisees, to the extent permitted by law. This control over pricing, along with the initial and ongoing fees, represents the franchisee's financial obligations to maintain and operate an Afuri Ramen Dumpling franchise.