Is the Subfranchisor responsible for expenses incurred in selling and servicing Unit Franchisees for Anago?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
- (i) Unless otherwise expressly provided to the contrary in this Agreement, all expenses incurred by Subfranchisor in selling and servicing the Unit Franchisees as required pursuant to ARTICLE 3 are the sole expense and obligation of Subfranchisor.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, the Subfranchisor is responsible for expenses incurred while selling and servicing Unit Franchisees. Unless specifically stated otherwise in the agreement, the Subfranchisor bears the sole expense and obligation for all expenses related to selling to and servicing Unit Franchisees as required by Article 3 of the agreement.
This means that the Subfranchisor must factor in costs like marketing, training, and ongoing support for Unit Franchisees when budgeting. These costs are not covered by Anago, so the Subfranchisor needs to manage them effectively to maintain profitability.
This allocation of expenses is a standard practice in franchising, where Subfranchisors often take on the responsibility for local support and development while the franchisor focuses on broader brand management and system-wide initiatives. Prospective Subfranchisors should carefully evaluate these potential expenses and ensure they have a solid plan for managing them.