When is the referral fee payable to a Big O Tires franchisee who refers a new prospect?
Big_O_Tires Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchise Referral Program. We encourage referrals from our existing franchisees of a prospective franchisee to us. Our referral program offers a $10,000 referral fee to the person who refers to us a franchisee prospect that we are not currently in discussions with and have not previously contacted. The referral fee is payable only if the referred prospect becomes a Big O franchisee. The referral fee is applied as a credit against an existing franchisee's trade account 30 days after the opening of the new Big O Store. The incoming prospective franchisee must have signed a Franchise Agreement and the initial franchise fee must have been paid to us before we will apply the credit. We reserve the right at any time to cancel, modify, amend, or terminate our referral program. If a franchisee wants to benefit from the referral program, the referring franchisee must be in good standing.
Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 9–12)
What This Means (2025 FDD)
According to Big O Tires's 2025 Franchise Disclosure Document, a franchisee who refers a prospective franchisee may be eligible for a $10,000 referral fee. However, several conditions must be met before the fee is paid. First, Big O Tires must not already be in discussions with or have previously contacted the referred prospect.
The referral fee is only payable if the referred prospect actually becomes a Big O Tires franchisee. This means the prospect must sign a Franchise Agreement and pay the initial franchise fee to Big O Tires. Once these conditions are met and the new Big O Store opens, the $10,000 referral fee is applied as a credit against the existing franchisee's trade account. This credit is applied 30 days after the opening of the new Big O Tires store.
It's important to note that Big O Tires reserves the right to cancel, modify, amend, or terminate the referral program at any time. Additionally, the referring franchisee must be in good standing to benefit from the program. This means that a franchisee who is not in compliance with their Franchise Agreement or other obligations to Big O Tires may not be eligible for the referral fee.