What happens if a Buildingstars franchisee fails to meet the Minimum Revenue Requirement in any month?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything contained herein to the contrary, if state law permits, BUILDINGSTARS shall be permitted to terminate the franchise immediately upon notice when the basis or grounds for cancellation is: (a) FRANCHISEE or its owners are convicted of a felony or any other criminal misconduct which materially and adversely affects the operation, maintenance, reputation, or goodwill of the franchise; (b) fraudulent activity which materially and adversely affects the operation, maintenance, reputation, or goodwill of the franchise; (c) abandonment of the franchise; (d) bankruptcy or insolvency of the FRANCHISEE; (e) the giving of more than two (2) no account or insufficient funds checks within a twelve-month period; or (f) failing to generate the Minimum Revenue Requirement in any month; or (g) any other act or omission which permits termination without notice and/or an opportunity to cure under applicable state law.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, failing to meet the Minimum Revenue Requirement in any month can lead to immediate termination of the franchise agreement, provided that state law permits such action. Specifically, Buildingstars is permitted to terminate the franchise immediately upon notice if state law allows it.
This is a significant risk for franchisees, as a single month of underperformance can potentially result in the loss of their franchise. This is especially important to consider when projecting revenues and managing the business. Franchisees should be aware of the Minimum Revenue Requirement and ensure they have a plan to consistently meet it.
It is important for prospective franchisees to understand the specific state laws that govern franchise terminations in their area. They should consult with a legal professional to fully understand their rights and obligations under the franchise agreement and applicable state laws. This will help them assess the risk associated with the Minimum Revenue Requirement and make informed decisions about investing in a Buildingstars franchise.