What expenses does Azal Coffee use the mobile application and technology fee for?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
(or reinstate the marketing fund if it is terminated).
4.4 Mobile Application and Technology Fee.
You must pay us a mobile application and technology fee, which amount is currently fifty dollars ($50.00) per month. The mobile application and technology fee must be paid to us on the first business day of each month in the manner specified in Section 4.13. We reserve the right to increase the mobile application and technology fee to up to three hundred dollars ($300.00) per month upon written notice to you. The mobile application and technology fee will be used by us for expenses relating to the administration and maintenance of technology used in our Franchise System. The mobile application and technology fee is not refundable. Although you must pay the mobile application and technology fee to us, you will still be responsible for any license fees and the expense of maintenance and updates, including service contracts, relating to point of sale ("POS") computer system software and other technology used in the Franchise Business. In addition to the mobile application and technology fee, we may collect from you and pay to third parties initial set-up and ongoing licensing fees for any Franchise Technology provided by third parties. We may also charge you a fee to manage any Franchise Technology provided by third parties, which shall be in addition to the mobile application and technology fee. These fees must be paid in the manner specified in Section 4.13 by the 1st day of each month (or at such other times as we may specify). We do not currently, but reserve the right to require that you pay us or our affiliates an administrative fee for administering franchise and marketing programs for the Franchise System. We reserve the right to increase the administrative fee in our sole and complete discretion. The administrative fee must be paid in the matter spec
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, the mobile application and technology fee is used for expenses relating to the administration and maintenance of technology used in their Franchise System. Currently, this fee is $50 per month, but Azal Coffee reserves the right to increase it to $300 per month with written notice.
Even though franchisees must pay this fee, they are still responsible for license fees and the expenses of maintenance and updates, including service contracts, related to the point of sale (POS) computer system software and other technology used in the Franchise Business. Azal Coffee may also collect initial set-up and ongoing licensing fees from franchisees to pay to third parties for any Franchise Technology provided by them.
Furthermore, Azal Coffee may charge a separate fee to manage any Franchise Technology provided by third parties, which is in addition to the mobile application and technology fee. All these fees must be paid as specified in Section 4.13 by the 1st day of each month or at other times specified by Azal Coffee. This means that franchisees need to budget not only for the stated mobile application and technology fee but also for potential increases, additional license fees, and management fees for third-party technology, ensuring they have sufficient capital to cover these ongoing technology-related costs.