How will the Bft Franchisor credit the Development Fee towards future franchise agreements?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
develops and commences operation of a replacement Studio in compliance with an applicable Franchise Agreement. If, during the Term, Developer transfers a Studio in accordance with the transferred Studio's Franchise Agreement, the transferred Studio shall continue to be counted in determining Developer's compliance with the Development Schedule so long as it continues to be operated as a Studio. If, at any time, the transferred Studio ceases to be operated as a Studio, it will not count toward satisfaction of the Development Schedule.
4. DEVELOPMENT FEE
Concurrently with the execution of this Agreement, Developer must pay to Fra
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the Development Fee is credited towards future franchise agreements. Specifically, Bft will credit the Development Fee in $10,000 increments. These credits will be applied toward the Initial Franchise Fee due under the second and each subsequent Franchise Agreement signed under the Multi-Unit Agreement. This process continues until the total amount of credits equals the Development Fee.
This arrangement benefits the developer by reducing the upfront costs associated with opening multiple Bft franchise locations. Instead of paying the full Initial Franchise Fee for each location, the developer can use the credits accumulated from the Development Fee to offset these costs. This can significantly improve the franchisee's cash flow during the initial stages of development.
However, it's important to note that the Development Fee itself is non-refundable and is deemed fully earned by Bft upon the execution of the Multi-Unit Agreement. This means that if the developer does not open enough franchise locations to utilize the full Development Fee credit, the remaining balance is forfeited. Therefore, prospective Bft developers should carefully consider their development plans and financial capabilities before entering into a Multi-Unit Agreement to ensure they can maximize the benefits of the Development Fee credit.