Is the sourcing fee refundable under any circumstances for a Bft franchise?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
d to the broker, in lieu of the Initial Franchise Fee.
Additionally, if you are an existing franchisee and a franchise broker is owed a commission in connection with the purchase of your additional franchise(s) and/or Development Rights under a Multi-Unit Agreement based on a previously-made introduction to us or our affiliates, you will pay us an additional sourcing fee as follows: (i) if you acquire a single additional franchise, the sourcing fee will be $28,000 (in addition to the Initial Franchise Fee); (ii) if you acquire Development Rights under a Multi-Unit Agreement for the right to open two (2) additional Studios, then the sourcing fee will be $40,000 (in addition to your Development Fee); (iii) if you acquire Development Rights under a Multi-Unit Agreement for the right to open three (3) to five (5) Studios, then the sourcing fee will be $50,000 (in addition to your Development Fee); (iv) if you acquire Development Rights under a Multi-unit Agreement for the right to open six (6) to nine (9) Studios, then the sourcing fee will be $84,000 (in addition to your Development Fee); and (v) if you acquire Development Rights under a Multi-Unit Agreement for the right to open ten (10) or more Studios, then the sourcing fee will be $120,000 (in addition to your Development Fee). Any applicable sourcing fee will be due on the signing of your Franchise Agreement and/or Multi-Unit Agreement, will be fully earned upon payment, and will not b
Source: Item 5 — INITIAL FEES (FDD pages 18–21)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the sourcing fee is non-refundable under any circumstances. This fee is applicable when a franchise broker is owed a commission in connection with the purchase of an existing Bft studio from a system franchisee, or when an existing franchisee acquires additional franchises or development rights through a broker's introduction. The sourcing fee helps Bft cover the commission owed to the broker.
The amount of the sourcing fee varies depending on the scenario. If purchasing an existing studio, the sourcing fee is $30,000. For existing franchisees acquiring additional franchises, the fee is $28,000 for a single franchise. If acquiring development rights under a Multi-Unit Agreement, the sourcing fee ranges from $40,000 for two additional studios to $120,000 for ten or more studios. These fees are in addition to the initial franchise fee or development fee, as applicable.
This non-refundable policy means that once the sourcing fee is paid upon signing the Franchise Agreement or Multi-Unit Agreement, it will not be returned to the franchisee, regardless of any subsequent events or changes in circumstances. Prospective Bft franchisees should carefully consider this non-refundable aspect of the sourcing fee before entering into any agreements that require its payment. This is a fairly standard practice in franchising, as these fees are used to compensate brokers for their services in facilitating the franchise transaction.