Are the fees paid to Azal Coffee or its affiliates refundable?

According to Azal Coffee's 2024 Franchise Disclosure Document, all fees paid to Azal Coffee or its affiliates are non-refundable. This means that once a franchisee pays any fee to Azal Coffee or its affiliates, they generally cannot get that money back, regardless of the circumstances. This policy applies uniformly to all franchisees.

This non-refundable policy covers various fees that a franchisee might pay, such as the audit and inspection expenses (cost of audit or inspection plus employee expenses), product and supplier approval fee (up to $3,000), data security consultant and cyber insurance costs (cost of engaging vendor or of cyber insurance policy), indemnification (amount will vary under circumstances), liquidated damages for failure to comply with obligations ($100 to $2,500 depending on the violation), deadline extension fee ($5,000), liquidated damages for loss of bargain under franchise agreement (see Note (7)), minimum local advertising and advertising cooperative (1% of monthly Gross Sales), mobile application / technology fee (currently $50 per month, but Azal Coffee reserves the right to charge up to $300 per month), inventory and equipment (varies), point-of-sale system fee (not currently assessed), and maintenance, repairs, renovation, and modernization (not more than $5,000).

Given this policy, prospective Azal Coffee franchisees should carefully consider their financial situation and business plan before paying any fees. It is crucial to understand the services or rights they are receiving in exchange for each fee and to assess the likelihood of needing those services or exercising those rights. For example, before requesting a deadline extension and paying the $5,000 fee, a franchisee should be reasonably confident that the extension will enable them to secure a suitable location and move forward with the franchise. Similarly, before requesting Azal Coffee to approve a new product or supplier, incurring a fee of up to $3,000, the franchisee should assess the potential benefits and ensure that the approval is likely to improve their business operations.

While most fees are non-refundable, minimum local advertising expenses may be paid directly to advertising providers, rather than to Azal Coffee or its affiliates. Franchisees should confirm whether they are paying advertising providers directly, or paying Azal Coffee, to ensure they understand the refund policy that applies.