How is the Development Fee calculated for a Bb.Q Chicken multi-unit development agreement?
Bb_Q_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
ated in the area described in Attachment 2 of this Agreement (hereinafter "Development Area").
- 1.2 Each Franchised Business for which a Development Right is granted hereunder shall be established and operated pursuant to a Franchise Agreement to be entered into between you and us in accordance with Section 3.1 hereof.
- 1.3 Except as otherwise provided in this Agreement, we shall not establish, nor franchise anyone other than you to establish, a Franchised Business in the Development Area during the term of this Agreement, provided you are not in default hereunder.
- 1.4 This Agreement is not a Franchise Agreement and does not grant to you any right to use the Marks or System.
- 1.5 You shall have no right under this Agreement to franchise others under the Marks or System.
SECTION 2 DEVELOPMENT FEE
- 2.1 In consideration of the development rights granted herein, you shall pay to us a development fee as outlined in Attachment 1 hereto (the "Development Fee"). The Development Fee is fully earned at the time this Multi-Unit Development Agreement is signed and is not refundable under any circumstances. Developer shall pay the full amount of the Development Fee to Franchisor upon Developer's execution of this Agreement. The Development Fee is calculated as one hundred percent (100%) of the initial franchise fee for each Franchised Business you commit to develop hereunder.
- 2.2 The initial franchise fee for each Franchised Business to be developed hereunder is Forty Thousand Dollars ($40,00
Source: Item 23 — RECEIPTS (FDD pages 62–283)
What This Means (2025 FDD)
According to Bb.Q Chicken's 2025 Franchise Disclosure Document, the Development Fee for a multi-unit development agreement is calculated as 100% of the initial franchise fee for each Bb.Q Chicken restaurant the developer commits to open. The initial franchise fee for each restaurant is $40,000. This fee is paid when the Multi-Unit Development Agreement is signed and is not refundable.
For example, if a developer commits to opening five Bb.Q Chicken locations, the Development Fee would be $200,000 (5 locations x $40,000). The developer must pay this full amount to Bb.Q Chicken upon signing the agreement. The FDD specifies that the Development Fee is fully earned by Bb.Q Chicken upon execution of the agreement and is non-refundable, covering administrative expenses and lost development opportunities.
Bb.Q Chicken credits the initial franchise fee of $40,000 for the first Franchised Business upon execution of the Multi-Unit Operator Agreement. Subsequently, upon the execution of each additional Franchise Agreement for a Franchised Business to be developed, Bb.Q Chicken will credit $40,000 from the Development Fee to satisfy the initial franchise fees due. This means that while the Development Fee is paid upfront, it essentially prepays the initial franchise fees for each location as they are opened.
Prospective multi-unit operators should carefully consider the non-refundable nature of the Development Fee and ensure they have the financial resources and commitment to develop the agreed-upon number of Bb.Q Chicken locations. They should also review Attachment 1 of the Multi-Unit Operator Agreement, which outlines the Development Fee and Minimum Performance Schedule, to fully understand their obligations.