Does an Alloy franchisee have a minimum annual Gross Sales requirement between signing the Franchise Agreement and opening for business?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
r which we can modify the boundaries of your Designated Area during the term of your Franchise Agreement.
You must achieve a minimum level of Gross Sales annually to retain your territorial rights, as follows (there is no Minimum Annual Gross Sales for the period of time between signing your Franchise Agreement and the date you open):
| | Year of Operation (beginning when you | Minimum Annual Gross Sales | |---|---|---| | | open for business | | | Year 1 | | $240,000 | | Year 2 and each subsequent year of operation | | $300,000 | | through the initial term of your Franchise | | | | Agreement | | | We reserve the right, based on an individual franchisee's circumstances, to reduce or modify the minimum annual Gross Sales that a franchisee must achieve, although we will not increase the minimum annual Gross Sales without your consent. If we do this, we are not required to grant you a similar modification.
If you fail to achieve the minimum annual Gross Sales a first time, you must receive additional on-site training and assistance from one of our representatives, at your expense (including payment of our then-current per diem fee plus reimbursement of our representative's expenses). If you fail to achieve the minimum annual Gross Sales a second time, we may again require you to receive additional on-site training and assistance. If you fail to achieve the minimum annual Gross Sales a third time, we may terminate your Franchise Agreement without giving you the opportunity to cure the default. You must pay any shortfall of royalty fees for each failure to achieve the minimum annual Gross Sales.
Source: Item 12 — TERRITORY (FDD pages 42–46)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, there is no minimum annual gross sales requirement for the period between signing the Franchise Agreement and opening the Alloy facility for business. However, once the Alloy facility is open, the franchisee must achieve a minimum level of gross sales annually to maintain their territorial rights.
Specifically, in the first year of operation, the minimum annual gross sales is $240,000. In the second year and each subsequent year through the initial term of the Franchise Agreement, the minimum annual gross sales increases to $300,000. Failing to meet these minimums can lead to required additional on-site training at the franchisee's expense, and repeated failure to achieve the minimums can result in termination of the Franchise Agreement.
Alloy also reserves the right to reduce or modify the minimum annual Gross Sales that a franchisee must achieve based on individual circumstances, but will not increase the minimum without the franchisee's consent. If a franchisee fails to achieve the minimum annual Gross Sales a first time, they must receive additional on-site training and assistance from one of Alloy's representatives, at their expense, including payment of Alloy's then-current per diem fee plus reimbursement of the representative's expenses. If the franchisee fails to achieve the minimum annual Gross Sales a second time, Alloy may again require additional on-site training and assistance. If the franchisee fails to achieve the minimum annual Gross Sales a third time, Alloy may terminate the Franchise Agreement without giving the franchisee the opportunity to cure the default. The franchisee must pay any shortfall of royalty fees for each failure to achieve the minimum annual Gross Sales.