What are all the fees a Black Bear Diner franchisee might pay, considering both Item 5 and Item 6?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
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| Number of | Franchise Fee | Development Fee | |
|---|---|---|---|
| Franchised | |||
| Restaurants to be | |||
| Developed | $55,000 $45,000 $40,000 $32,000 | ||
| Type of Fee(1) | Amount | Due Date | |
| Royalty | 4.5% of Gross Sales(2) | Weekly | |
| Type of Fee(1) | Amount | Due Date | |
| Marketing Fund Contribution | 1% of Gross Sales | Weekly | |
| Local Advertising | 1% of Gross Sales | Monthly | |
| Grand Opening Advertising | $5,500 | Between 1 week prior to opening and 8 weeks after opening | |
| Renewal Fee | $5,000 | Upon signing renewal documents | |
| Audit Expenses | Cost of audit plus interest | As invoiced | |
| Late Payment Interest | 18% of the overdue amount, calculated daily, or the maximum rate permitted by law, whichever is less | After due date | |
| Black Bear Diner Gift Shop Purchases | Will vary under circumstances | As required | |
| Merchant and Gift Card Processing Fees | Approximately $75 per month plus transaction fee ranging from approximately 4.7-6%. | Monthly | |
| Waitlist Management System | Approximately $50-$60 per month | Monthly | |
| Type of Fee(1) | Amount you Franchised Restaurant which are currently approximately $300 per inspection | Due Date | |
| Reschedule of Scheduled Opening Date | Our actual costs of rescheduling which are estimated to range from $4,500 to $8,000 | At Time of Rescheduling | |
| Failure to Attend Franchisee Convention | $2,500 | Same as Royalty Fee | |
| Failure to Attend General Manager Annual Training Meeting | $1,500 | Same as Royalty Fee | |
| Damages, Costs and Attorneys’ Fees | Will vary under circumstances | As incurred | |
| Indemnification | Will vary under circumstances | As incurred | ### Explanatory Notes: |
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- Unless stated otherwise, all fees are imposed and collected by and payable to us. No fees are refundable. Existing franchisees may have fees that differ from those stated in the table above.
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What This Means (2025 FDD)
According to the 2025 Black Bear Diner Franchise Disclosure Document, franchisees can expect to pay a variety of fees throughout the term of their agreement. The initial franchise fee for the first Black Bear Diner restaurant is $55,000. However, if a franchisee develops multiple restaurants under an Area Development Agreement, the franchise fee for each restaurant is based on a schedule, with the amounts varying based on the number of restaurants to be developed. These fees compensate Black Bear Diner for training and pre-opening obligations and are generally non-refundable.
Beyond the initial franchise fee, franchisees will encounter ongoing fees. A royalty fee of 4.5% of gross sales is paid weekly. Additionally, franchisees must contribute to the marketing fund, which is 1% of gross sales, also paid weekly. Local advertising requires another 1% of gross sales, paid monthly. Other potential fees include a grand opening advertising fee of $5,500, a renewal fee of $5,000, and audit expenses covering the cost of the audit plus interest.
Additional fees may arise depending on specific circumstances. These include late payment interest at 18% of the overdue amount, costs for Black Bear Diner Gift Shop purchases, merchant and gift card processing fees (approximately $75 per month plus transaction fees), and waitlist management system fees (approximately $50-$60 per month). There are also fees for rescheduling a scheduled opening date (estimated between $4,500 and $8,000), failure to attend the franchisee convention ($2,500), and failure to attend the General Manager Annual Training Meeting ($1,500). Finally, a $5,000 relocation fee is required if a franchisee relocates their restaurant.
It is important for prospective franchisees to carefully review all potential fees outlined in the Franchise Disclosure Document and discuss any questions or concerns with the franchisor before signing the agreement. Understanding the full scope of financial obligations is crucial for making an informed decision about investing in a Black Bear Diner franchise.