When are the Management Service Fees payable for a Beard Papas franchise?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor has the right to charge fees and expenses, as determined by Franchisor, in Franchisor's Reasonable Business Judgment, for management services (the "Management Service Fees").
Any determination as to whether or not Franchisor may elect to provide management services, if any, and the extent of such services, and/or the discontinuation thereof, shall be exclusively determined by Franchisor in Franchisor's Reasonable Business Judgment.
The Management Service Fee shall be immediately payable upon invoice by us.
Source: Item 23 — RECEIPTS (FDD pages 58–275)
What This Means (2025 FDD)
According to the 2025 Beard Papas Franchise Disclosure Document, if the Franchisor appoints a manager to maintain the operations of the Franchised Business on behalf of the Franchisee, the franchisee will be charged Management Service Fees. The amount of these fees will be determined by Beard Papas in their reasonable business judgment.
These Management Service Fees are charged when a Managing Owner or Operating Manager is not managing the Franchised Business, and the Franchisor appoints a manager. This could occur if the franchisee is unable to manage the business themselves or does not have a qualified Operating Manager. The appointment of a manager by Beard Papas does not relieve the franchisee of their obligations under the Franchise Agreement.
The Management Service Fee is payable immediately upon invoicing by Beard Papas. This means that franchisees must be prepared to pay these fees promptly to avoid any potential penalties or disruptions to their business operations. Franchisees should clarify with Beard Papas the specific circumstances under which management services would be provided and the typical range of fees charged for such services to better prepare for this potential expense.
It is important to note that Beard Papas is not liable for any debts, losses, costs, or expenses incurred during the period when the Franchisor's appointed manager is running the business. This highlights the importance of franchisees maintaining qualified management to avoid the need for the Franchisor to step in and the associated fees.