Is the Technology Fee for a Better Blend franchise a pass-through of Better Blend's exact costs?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
rge Franchisee a commercially-reasonable fee (the "Technology Fee") in exchange for software and other technology-related services and products provided by or through BBF. The Technology Fee does not have to be a pass-through of BBF's exact costs. BBF has no liability or obligation to Franchisee with respect any third-party software or other technology-related services and products that BBF provides to Franchisee. The Technology Fee for a given period is due and payable at the same time as the Royalty Fee, unless BBF determines otherwise. BBF may add, remove, or alter the software or technology products or services that it provides. BBF may change Technology
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2024 FDD)
According to the 2024 Better Blend Franchise Disclosure Document, the Technology Fee does not have to be a direct pass-through of Better Blend's exact costs. This means that Better Blend has the discretion to set the Technology Fee at an amount that may or may not directly correspond to the costs they incur for providing software and technology-related services.
This policy provides Better Blend with flexibility in managing the Technology Fee. It also means that the fee could potentially include a profit margin for Better Blend, or it could be used to subsidize other services or products offered to franchisees. The Technology Fee will not exceed $500 per month, though Better Blend may increase this limit to reflect inflation from January 1, 2022, after providing at least 30 days' notice.
As a prospective franchisee, it is important to understand that the Technology Fee is subject to change. Better Blend may add, remove, or alter the software or technology products or services provided, and they can change the Technology Fee after giving at least 30 days' notice. Franchisees should inquire about the specific technology services covered by the fee and how the fee is determined to fully understand its value and potential impact on their operating costs.