What factors does Aplus consider when determining the amount and applicability of the Supplemental Franchise Fee for a Captive Market Aplus store?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
fee for multi-site franchisees.
If you choose to operate your franchise in a Captive Market, we may charge a supplemental franchise fee ("Supplemental Franchise Fee") ranging from $15,000 to $300,000 depending on the location of your APLUS Store within the Captive Market. You may pay additional fees to state, county, or other government agency for your right to operate in a Captive Market. The amount and applicability of such a fee is determined solely by us based on a number of factors, including, but not limited to, historical store performance, sales volume, the amount paid by us or an affiliate to purchase the APLUS Store and the value of
Source: Item 5 — INITIAL FEES (FDD pages 15–16)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, if a franchisee chooses to operate their franchise in a Captive Market, Aplus may charge a Supplemental Franchise Fee. This fee can range from $15,000 to $300,000, depending on the Aplus store's location within the Captive Market. Aplus determines the amount and applicability of this fee based on several factors.
The factors Aplus considers include the historical store performance, which likely refers to the sales and profitability of the location before it became an Aplus franchise. Another factor is the sales volume, indicating how much product the store sells. The amount Aplus or its affiliate paid to purchase the Aplus Store is also a consideration, as is the value of the goodwill of the Aplus Store, which refers to the intangible value associated with the store's reputation and customer base.
Prospective franchisees should note that these fees are in addition to any fees they may have to pay to state, county, or other government agencies for the right to operate in a Captive Market. This supplemental fee can significantly increase the initial investment required to open an Aplus franchise in a Captive Market. It is important for potential franchisees to carefully evaluate the potential benefits of operating in a Captive Market against the higher costs associated with the Supplemental Franchise Fee.