How is the development fee calculated for a Baya Bar MUDA?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
nder any other circumstances.
Multi-Unit Development Agreement: If you and we agree that you will develop and operate multiple Baya Bar Franchised Businesses, then you will pay to us a development fee equal to 100% of the initial franchise fee for the first Shop to be developed, plus 50% of the reduced initial franchise fee for each additional Shop you commit to develop under the MUDA. For example, if you commit to develop three Shops, the development fee is calculated as $35,000 + (50% of $30,000=$15,000) + (50% of $25,000=$12,500) = $62,500. The development fee is imposed uniformly on all multi-unit developers and is fully earned by us when received. These franchise fees are refundable only as described abov
Source: Item 5 — INITIAL FEES (FDD pages 10–11)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the development fee for a Multi-Unit Development Agreement (MUDA) is calculated based on a percentage of the initial franchise fee for each shop a developer commits to open. The fee is 100% of the initial franchise fee for the first shop, plus 50% of the reduced initial franchise fee for each additional shop. The initial franchise fee for the first Baya Bar shop is $35,000. The initial franchise fee is reduced to $30,000 for the second shop, and further reduced to $25,000 for the third and any subsequent shops.
For example, if a developer commits to opening three Baya Bar shops, the development fee is calculated as follows: $35,000 for the first shop, plus 50% of $30,000 ($15,000) for the second shop, plus 50% of $25,000 ($12,500) for the third shop. This results in a total development fee of $62,500.
The development fee is imposed uniformly on all multi-unit developers and is fully earned by Baya Bar upon receipt. These franchise fees are refundable only under specific circumstances, such as if the franchisee fails to complete the pre-opening training program to Baya Bar's satisfaction or if Baya Bar concludes that the franchisee cannot satisfactorily operate the franchised business. Otherwise, the development fee is non-refundable.