What is the minimum number of bakeries a Brueggers Bagels developer must commit to under the Development Agreement?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
If you qualify, we may offer you the opportunity to develop multiple Bakeries by signing a Development Agreement with us. Our current form of Development Agreement is in Exhibit B to this disclosure document. Under the Development Agreement, you will have the right and the obligation to develop a specified number of Bakeries (or Licensed Bakeries (defined below)) by certain deadlines. You will negotiate both the number of Bakeries and the deadlines with us, but the minimum commitment is two Bakeries. We can reduce the Development Area or terminate the Development Agreement entirely if you do not have the required number of Bakeries open and in operation by the agreed-upon deadlines.
You do not have to enter into any Franchise Agreements at the time you sign the Development Agreement. However, for each Bakery you develop under the Development Agreement, you must sign the form of Franchise Agreement that we are then offering to new franchisees, the terms and conditions of which may be substantially different from those in the Franchise Agreement in Exhibit A (including, for example, with respect to higher fees, shorter term, or other factors more burdensome to you).
Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 5–10)
What This Means (2025 FDD)
According to Brueggers Bagels' 2025 Franchise Disclosure Document, a developer who signs a Development Agreement must commit to developing a specific number of bakeries, with a minimum commitment of two bakeries. The exact number of bakeries and the deadlines for their development are negotiated between the developer and Brueggers Bagels. These bakeries can be either traditional bakeries or Licensed Bakeries, which are outlets operating under a License Agreement, often in non-traditional locations.
This commitment carries significant implications for potential developers. Brueggers Bagels retains the right to reduce the Development Area or even terminate the Development Agreement if the developer fails to have the required number of bakeries open and operating by the agreed-upon deadlines. This underscores the importance of carefully assessing one's capacity to meet the development schedule before entering into such an agreement.
Furthermore, while a developer does not need to sign Franchise Agreements at the time of the Development Agreement, they must sign a Franchise Agreement for each bakery they develop. It is important to note that the terms and conditions of these future Franchise Agreements may differ substantially from the sample agreement provided in the FDD, potentially including higher fees or a shorter term, which could make the agreement more burdensome for the franchisee. Therefore, prospective developers should consider these potential changes when evaluating the overall investment and commitment required.
In summary, the Development Agreement with Brueggers Bagels requires a minimum commitment of two bakeries, but the negotiated number and the potential for changes in the Franchise Agreement terms introduce a level of risk and uncertainty that prospective developers must carefully evaluate.