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What are all the fees Ben Jerrys franchisees might encounter, considering both Item 5 and Item 6?

Ben_Jerrys Franchise · 2025 FDD

Answer from 2025 FDD Document

[Item 5: INITIAL FEES]

As described in Item 1, Scoop Shops will generally be for a term of 10 years. We may, however, in certain circumstances agree to offer Scoop Shop franchises for shorter terms. If we agree to a shorter term, then the initial franchise fee due for that Scoop Shop will be an amount equal to $39,500 prorated according on the number of years in the term (for example, for a Shop with a 5-year term, the initial franchise fee will be $19,750). The Reduced Term Addendum that will be signed for any Scoop Shop with a term shorter than 10 years will specify the amount of the initial franchise fee. Unless otherwise stated, any references to initial franchise fees in this Disclosure Document assume that the franchise for a Scoop Shop is for 10 years.

We may reduce, defer or waive the initial franchise fee for other Ben & Jerry's Shops that require an entry fee to obtain a site or when a unique or compelling situation warrants. During our last fiscal year ended December 31, 2024, we had a range of initial fees of $0 to $39,500. The reduction in initial fees was due to franchisee candidates that qualified for our then-current incentive programs.

Satellite Shops

If you enter into a Satellite Addendum with us, the initial satellite fee is $8,000 and is earned and non-refundable in consideration of administrative and other expenses we incur in entering into the Franchise Agreement and Satellite Addendum.

Test Shops

[Item 22: CONTRACTS]

4. FEES

  • 4.1 In consideration of the franchise granted herein, OPERATOR has, upon execution of this Addendum, paid to BEN & JERRY'S an initial test fee of two thousand five hundred dollars ($2,500), receipt of which is hereby acknowledged, which is earned and non refundable in consideration of administrative and other expenses incurred by BEN & JERRY'S in entering into this Agreement. If, prior to or upon the Test Expiration, OPERATOR and BEN & JERRY'S enter into a new Franchise Agreement for the Test Shop as described in Section 3.3 above, BEN & JERRY'S shall credit the initial test fee paid by OPERATOR toward the initial franchise fee due under such Franchise Agreement.
  • 4.2 Each month during the term of this Addendum, OPERATOR shall pay BEN & JERRY'S a continuing royalty fee in an amount that will not exceed five percent (5.0%) of the Gross Sales (as defined in Section 4 of the Franchise Agreement) of the Test Shop during the prior month. All other terms of the Franchise Agreement regarding payment of royalties shall apply with respect to the Test Shop as well as the Scoop Shop.

[Item 5: INITIAL FEES]

For Ben & Jerry's Scoop Shop managers that are pursuing franchise ownership, we offer a waiver of initial franchise fees (such waiver is intended for managers will own 100% of the franchise), up to a 2-year period of royalty waivers (a 2-year royalty waiver shall be applicable to managers that acquire at least 50% equity/ownership of a franchise in the aggregate; a 1-year royalty waiver shall be applicable to managers that acquire between 20-50% equity/ownership of a franchise in the aggregate ) and reimbursement for approved learning and development expenses (e.g., attending Ben & Jerry's Franchise Annual Meeting). Qualification for this program is evaluated on a case-by-case basis and managers must meet certain criteria to be considered for the program. As of the issuance date of this disclosure document, such criteria include (i) a minimum equity/ownership interest of 20% in the franchise; (ii) a minimum of 1-year experience as a Ben & Jerry's Scoop Shop manager; (iii) demonstrated System participation (e.g. attendance at Franchise Annual Meeting, participation in Systemwide calls, etc.); and (iv) a demonstrated commitment to and understanding of Ben & Jerry's three-part mission (see Item 1, above). This program may be modified without notice at any time and we may establish and/or eliminate any benefits as we deem in the best interests of the System.

[Item 22: CONTRACTS]

  • 4.2 Each month during the term of this Agreement, OPERATOR shall pay BEN & JERRY'S a continuing royalty fee in an amount that will not exceed five percent (5.0%) of the Gross Sales (as defined in Section 4.4 below) of the Scoop Shop during the prior month.

  • 4.3 OPERATOR shall make monthly contributions for marketing and promotion as specified in Section 12.1 based on the Gross Sales of the Scoop Shop.

[Item 11: FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING]

In addition to the POS System, you are required to purchase hardware to support online ordering (which can include orders for cakes, catering and on-demand delivery). You can expect to pay approximately $1,000-$1,500 for such hardware.

As noted in Item 6, we may also collect a "technology fee" to support the System's technological advancements and any technology related fees paid by Ben & Jerry's for the benefit of franchisees.

What This Means (2025 FDD)

According to Ben & Jerry's 2025 Franchise Disclosure Document, franchisees can expect to encounter several fees, including initial fees and other recurring costs. The initial franchise fee for a standard 10-year Scoop Shop franchise is $39,500, but this fee is prorated for shorter terms. For example, a 5-year term would have an initial fee of $19,750. Satellite Shops have an initial fee of $8,000. Development fees also apply, ranging from $10,000 to $15,000 for the first shop, depending on whether the operator is new or existing, plus additional fees for subsequent shops. A test shop requires an initial test fee of $2,500. These initial fees are generally non-refundable. However, Ben & Jerry's does offer an incentive program for managers pursuing franchise ownership, which may include waivers of the initial franchise fee and royalty waivers.

Beyond the initial fees, franchisees must pay ongoing fees. A continuing royalty fee will not exceed 5% of the Scoop Shop's gross sales. Franchisees also make monthly contributions for marketing and promotion based on gross sales.

Additionally, franchisees are responsible for technology-related expenses. While not explicitly defined as fees, franchisees must purchase hardware to support online ordering, estimated to cost between $1,000 and $1,500. Ben & Jerry's also reserves the right to collect a "technology fee" to support system advancements. These fees cover various aspects of the franchise operation, from initial setup to ongoing support and technological upgrades.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.