Under what condition does the Bft developer pay a sourcing fee of $40,000?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
| and between | BFT FRANCHISE SPV, LLC, a Delaware limited liability company with its principal business |
|---|---|
| address at 17877 | Von Karman Ave., Suite 100 Irvine, CA 92614 ("Franchisor"), and |
| , whose principal business address is | |
| ("Developer"). | |
| 1. , 20 this Sourcing Fee Unit Agreement. | Background. Developer and Franchisor are parties to that certain Multi-Unit Agreement dated (the "Multi-Unit Agreement") that has been signed concurrently with the signing of Addendum. This Sourcing Fee Addendum supersedes any inconsistent or conflicting provisions of the Multi-Unit Agreement. Terms not otherwise defined in this Sourcing Fee Addendum have the meanings as defined in the Multi-Unit Agreement. This Sourcing Fee Addendum is annexed to and forms part of the Multi |
| 2. | Sourcing Fee. Developer (and/or its a |
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, a developer may be required to pay a sourcing fee of $40,000. This fee is applicable when the developer is acquiring development rights under a Multi-Unit Agreement to open two additional Bft studios. This sourcing fee is in addition to the standard Development Fee.
The sourcing fee is a non-refundable payment that compensates a third-party franchise broker for introducing the developer to Bft or its affiliates. This fee is due upon the execution of the Multi-Unit Agreement. It's important to note that the sourcing fee is separate from and in addition to the Development Fee, which covers Bft's lost development opportunities.
Prospective Bft developers should carefully consider these sourcing fees when evaluating the financial requirements of a multi-unit development agreement. The fees vary depending on the number of additional studios the developer plans to open, ranging from $40,000 for two studios to $120,000 for ten studios. Understanding these costs is crucial for accurate financial planning and assessing the overall profitability of the franchise venture.