How does the Bft Development Fee increase with each additional studio required to open under the Development Schedule?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
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Multi-Unit Agreement
Development Fee
If we award you the right to acquire multiple Franchises for Studios within a given Development Area, you must commit to developing and opening at least 3 Studios and pay us a one-time Development Fee in a lump sum upon your execution of the Multi-Unit Agreement. You must execute our current form of Franchise Agreement for the first Studio we grant you the right to open within your Development Area concurrently with the Multi-Unit Agreement. Your Development Fee will be equal to $10,000 for each Studio, less the first one, that you commit to opening in satisfaction of an agreed upon Development Schedule specified in the Multi-Unit Agreement. The number of Studios required to be open under a Multi-Unit Agreement is an agreed upon number (typically, at least 3 Studios). If your Multi-Unit Agreement requires that you open 3 Studios, your Development Fee will be 2 x $10,000, or $20,000. For each additional Studio you are required to open under your Development Schedule, your Development Fee will increase by $10,000. While the Development Fee is not a deposit, we will apply it, in $10,000 increments, toward satisfaction of the initial franchise fee due under each Franchise Agreement (less the first one) you sign in satisfaction of your obligations under the Multi-Unit Agreement. The initial franchise fees paid under each Franchise Agreement shall be the same as required as of the date of this Disclosure Document. The Development Fee is payable in a lump sum, is not refundable, and is determined in the same manne
Source: Item 5 — INITIAL FEES (FDD pages 18–21)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, franchisees who enter into a Multi-Unit Agreement to develop multiple studio locations within a specific Development Area must pay a Development Fee. This fee is calculated based on the number of studios the franchisee commits to opening, with a minimum requirement of at least three studios. The Development Fee is $10,000 for each studio, excluding the first one.
For example, if a franchisee agrees to open three Bft studios, the Development Fee is calculated as 2 x $10,000, totaling $20,000. The FDD specifies that for each additional studio a franchisee is required to open under the Development Schedule, the Development Fee increases by $10,000. This fee is payable in a lump sum upon signing the Multi-Unit Agreement and is not refundable.
While the Development Fee is not a deposit, Bft applies it in increments of $10,000 toward the initial franchise fee due under each Franchise Agreement, excluding the first one. The initial franchise fees are the same as required in the 2025 Disclosure Document. This means that as franchisees open additional locations, the Development Fee contributes to offsetting the initial franchise fee for those locations.
Prospective franchisees should carefully consider the number of studios they commit to opening under a Multi-Unit Agreement, as this decision directly impacts the Development Fee. Understanding the Development Schedule and the associated fees is crucial for financial planning and ensuring sufficient capital is available to meet the obligations of the Multi-Unit Agreement with Bft.