How much of the Development Fee will be applied to subsequent Initial Franchise Fees for Brueggers Bagels?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
the right, and you undertake the obligation, pursuant to the terms and conditions of this Agreement, to develop _____________ (___) Bakeries, solely within the territory defined in Exhibit A to this Agreement (the "Development Area"). The Bakeries will be located only at the specific locations we approve in writing pursuant to Section 4.1 below. The Bakeries will be developed in accordance with the schedule set forth in Exhibit B to this Agreement (the "Development Schedule"). Exhibit A, the Development Area and Exhibit B the Development Schedule are incorporated herein as if fully set forth in this Agreement.
- 1.2. To exercise your development rights, you must execute a separate Bruegger's Franchise Agreement ("Franchise Agreement") with us for each Bakery to be developed, in accordance with Section 4.1 bel
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to Brueggers Bagels' 2025 Franchise Disclosure Document, a portion of the Development Fee is applied to the Initial Franchise Fee for each bakery. The initial franchise fee for each bakery is $30,000. For the first three bakeries opened under the Development Agreement, $10,000 of the Development Fee will be applied toward the Initial Franchise Fee.
For each subsequent bakery after the first three, Brueggers Bagels will apply an additional $5,000 of the Development Fee upon signing each Franchise Agreement. The franchisee is responsible for paying the balance of the Initial Franchise Fee, which is $30,000, when signing each subsequent Franchise Agreement.
This means that for the first three Brueggers Bagels locations, franchisees will receive a $10,000 credit towards the initial franchise fee. For each location after that, they will receive a $5,000 credit. This can significantly reduce the upfront costs for multi-unit developers, incentivizing them to expand the Brueggers Bagels brand. However, all amounts collected are deemed fully earned immediately upon receipt and are non-refundable, regardless of whether the franchisee successfully opens all the planned locations.