Under what circumstances does Bang Cookies charge a non-compliance fee?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
s |
| Non-compliance | Actual fees, costs, and expenses | On demand | Fees, costs and expenses incurred by us as a result of your breach or noncompliance with the terms of your Franchise Agreement. |
|---|---|---|---|
| Supplier Review | Actual fees, costs, and expenses | Within 14 days of invoice | You must pay us the costs incurred by us to review and evaluate a potential supplier, product, or service that you submit to us for approval. |
| Management Service | Actual costs incurred by us | As invoiced | Payable if we elect to manage the Franchised Business due to a failure by you to have the Franchised Business managed by an authorized Managing Owner or Manager. |
| Transfer | $15,000 | On demand | Payable if we approve your transfer request, but prior to execution of final transfer agreements and authorization. |
| Renewal | $10,000 | On signing renewal Franchise Agreement | Payable if we approve your renewal request and upon signing our then current Franchise Agreement. |
| Payment Processing Fee Reimbursement | Up to 3.5% plus $0.30 per payment | Within 10 days of request for payment | If banks, credit card companies, or other payment processors charge us a fee for processing any payment you make to us, you must reimburse us for the amount of the fee. |
Source: Item 6 — OTHER FEES (FDD pages 13–17)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, there are several instances where a franchisee may incur non-compliance fees. Bang Cookies may charge fees, costs, and expenses if a franchisee breaches or does not comply with the terms of the Franchise Agreement. The exact amount will depend on the specific situation and will be due upon demand.
Bang Cookies also outlines specific non-compliance fees for operational, reporting, and payment failures. Operational non-compliance, which involves failing to meet operational standards outlined in the Franchise Agreement, can result in fees ranging from $450 to $1,000 per occurrence, in addition to covering inspection and re-inspection costs incurred by Bang Cookies. For reporting non-compliance, franchisees may be charged $150 per occurrence for failing to submit Royalty and Activity Reports or other required financial statements on time. Payment non-compliance, which involves failing to make timely payments of fees due under the Franchise Agreement, also incurs a fee of $150 per occurrence, along with interest, costs, and legal fees.
Prospective Bang Cookies franchisees should be aware of these potential non-compliance fees and carefully review the Franchise Agreement to understand the specific requirements and standards they must adhere to in order to avoid these charges. Paying close attention to reporting deadlines, operational standards, and payment schedules can help franchisees maintain compliance and avoid unnecessary expenses.