When is the encroachment payment due to Bath Tune Up?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
| TYPE OF FEE 1 | AMOUNT | DUE DATE | REMARKS |
|---|---|---|---|
| Encroachment Payment | 100% of your gross sales in another franchisee’s territory. | When you make sales in another franchisee's territory in violation of your franchise agreement. | As an alternative to termination of your franchise for operating in another franchisee's territory. |
Source: Item 6 — OTHER FEES (FDD pages 15–19)
What This Means (2025 FDD)
According to Bath Tune Up's 2025 Franchise Disclosure Document, the encroachment payment is due when a franchisee makes sales in another franchisee's territory in violation of their franchise agreement. This payment is equal to 100% of the gross sales made in the other franchisee's territory.
The encroachment payment serves as an alternative to the termination of the franchise agreement if the franchisee operates outside of their designated territory. This means that instead of Bath Tune Up terminating the franchise agreement, the franchisee can pay the encroachment fee to maintain their franchise.
This fee structure incentivizes franchisees to respect territorial boundaries and operate within their assigned areas. It also provides Bath Tune Up with a mechanism to address and potentially resolve territorial disputes without resorting to franchise termination, which can be a costly and time-consuming process for both parties.