Is the initial franchise fee for Bombs Away uniform for all franchisees?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- 4.1 Initial Franchise Fee. Upon signing this Agreement, Franchisee shall pay an initial franchise fee in the amount stated on the Summary Page. This initial franchise fee is not refundable.
- 4.2 Royalty Fee. Franchisee shall pay Bombs Away Franchising a monthly royalty fee (the "Royalty Fee") equal to 8% of Gross Sales. The Royalty Fee for any given month is due on the 2nd day of the following month.
Source: Item 5 — INITIAL FEES (FDD page 9)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, the initial franchise fee is determined by the amount stated on the Summary Page of the franchise agreement. The FDD specifies that this initial franchise fee is non-refundable. This indicates that the initial franchise fee is not a negotiable item and is uniformly applied to all franchisees, as it is a fixed amount stated in the agreement.
However, the FDD also mentions that when a franchisee seeks to renew their agreement, they will execute Bombs Away's then-current standard form of franchise agreement. This new agreement may contain materially different provisions, including higher or different fees. Despite these potential changes in subsequent agreements, the initial franchise fee remains constant for the initial agreement term.
Furthermore, in the event of a transfer of the franchise to a new franchisee, the new franchisee will not be required to pay an initial franchise fee. This exception applies specifically to transfers and does not affect the initial fee paid by original franchisees. Therefore, while there are scenarios where an initial franchise fee is not required, the standard fee applies uniformly to all new franchisees entering into an initial franchise agreement with Bombs Away.