What is the Baya Bar transfer fee for transfers to an existing franchisee in good standing?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
te to the transferee's obligations to Franchisor; and
- 16.3.9 If consent is required, the lessor of the Franchised Business's premises consents to the assignment or further sublet of the premises to the transferee.
- 16.4 Transfer Fee. As a condition to any Transfer, Franchisee shall pay Franchisor a transfer fee equal to seventy-five percent (75%) of the then-current initial franchise fee; provided however, (i) for transfers to an existing franchisee in good standing with Franchisor, the transfer fee is fifty percent (50%) of the then-current initial franchise fee, (ii) for transfers of ownership interest among existing shareholders or members, or to add a new shareholder or member, of the Franchisee entity and such transfer does not change management control of the Franchisee entity, the transfer fee is Two Thousand Five Hundred Dollars ($2,500.00),
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the transfer fee for a franchise to an existing franchisee in good standing is 50% of the then-current initial franchise fee. This means that if a franchisee decides to sell their Baya Bar location to someone who already owns and operates a Baya Bar franchise and is in good standing with the company, they will pay a reduced transfer fee compared to selling to a new franchisee.
The reduced transfer fee can be a significant benefit for existing Baya Bar franchisees looking to expand their operations by acquiring additional locations. It lowers the financial barrier to growth and incentivizes current franchisees to reinvest in the brand. However, the fee is calculated based on the current initial franchise fee, so the amount could change over time.
It is important to note that this reduced fee is only applicable if the existing franchisee is in good standing with Baya Bar. 'Good standing' typically means the franchisee is compliant with all franchise agreement terms, including payment obligations, operational standards, and brand requirements. If a franchisee is not in good standing, they would likely be subject to the standard transfer fee, which is 75% of the then-current initial franchise fee.