What is the Anago Subfranchisor responsible for paying from its operating account?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
Subfranchisor will be responsible for the payment of sales tax, as applicable, which payments will be made from Subfranchisor's operating account.
Subfranchisor is solely responsible for payment to its Unit Franchisees for services rendered to Clients, which payments should be made on the 20th day of each month following the month in which services were rendered, or as otherwise prescribed in its Unit Franchise Agreement, as authorized by Franchisor, and Subfranchisor will provide its Unit Franchisees with a statement detailing the previous month's accounting activity.
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 paying sales tax from its operating account, as applicable. Additionally, the Subfranchisor is solely responsible for payments to its Unit Franchisees for services rendered to Clients. These payments should be made on the 20th day of each month following the month in which services were rendered, or as otherwise prescribed in its Unit Franchise Agreement, as authorized by Anago. The Subfranchisor must also provide its Unit Franchisees with a statement detailing the previous month's accounting activity.
This means that the Subfranchisor needs to allocate funds in their operating account to cover sales tax obligations and to compensate Unit Franchisees for their services. The timing of payments to Unit Franchisees is specified, requiring the Subfranchisor to maintain sufficient cash flow to meet these obligations by the 20th of each month. The Subfranchisor must also maintain detailed records of accounting activity to provide statements to Unit Franchisees.
Prospective Subfranchisors should consider these payment responsibilities when projecting their operating expenses and cash flow requirements. Accurately estimating sales tax liabilities and managing timely payments to Unit Franchisees are crucial for maintaining compliance and positive relationships within the Anago franchise system. The Subfranchisor's operating account must be managed carefully to ensure these obligations are met.