What happens to any Aplus store developed in excess of the minimum required during a Development Period?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
You may, subject to the terms and conditions of this Agreement and with Franchisor's prior written consent, which may be withheld in its sole discretion, develop more than the total minimum number of Stores which you are required to develop during any Development Period.
Any Store developed in excess of the minimum number of Stores required to be developed shall be applied to satisfy your development obligation during the next succeeding Development Period, if any.
Notwithstanding the above, you shall not open or operate more than the cumulative total number of Stores you are obligated to develop under the Development Schedule.
- 4.4.1.
If during the term of this Agreement, you cease to operate any Store developed under this Agreement for any reason, you shall develop a replacement Store.
The replacement Store shall be developed within a reasonable time (not to exceed 180 days) after you cease to operate the original Store.
Source: Item 22 — CONTRACTS (FDD page 68)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, if a developer builds more than the minimum number of stores required during a Development Period, those extra stores will count toward fulfilling the development obligations for the next Development Period, if there is one. However, the franchisee cannot open or operate more stores than the cumulative total they are obligated to develop under the Development Schedule.
For a prospective Aplus franchisee, this means that exceeding the minimum development requirements in one period can provide some flexibility in subsequent periods. If a franchisee anticipates challenges in meeting future development goals, overachieving early on could provide a buffer.
However, it's important to note that the franchisee is still bound by the overall Development Schedule and cannot exceed the total number of stores they are obligated to develop. This clause prevents a franchisee from saturating the market beyond what was initially agreed upon, which could potentially harm the performance of other Aplus locations.
Additionally, if an Aplus store ceases operation for any reason, the franchisee is obligated to develop a replacement store within a reasonable time, not exceeding 180 days. This requirement ensures that the Aplus brand maintains its presence and that the franchisee continues to meet their development commitments.