What other fees besides the initial franchise fee are detailed in the Burros Fries FDD?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
No such Loss shall relieve the Franchisee of the obligation to pay Royalty Fees and all other amounts owed hereunder.
Franchisee assumes all costs, liability, expense, and responsibility for locating, obtaining and developing a site for the Franchise Business to be established under the Franchise Agreement and for equipping the Business at such premises.
Before Franchisee opens a Burros & Fries Franchised Business, Franchisee must purchase insurance coverage from a responsible carrier with a performance rating of A or higher as rated in the most recent edition of Best Insurance Reports (or comparable criteria as we may specify) and Franchisee must maintain such insurance throughout the duration of the initial term of the Franchise Agreement and any renewal terms. Franchisee shall list us as additional insured on all its insurance policies. Franchisee will procure and maintain general liability insurance with a minimum policy limit of $2,000,000 per occurrence and $4,000,000 aggregate (this policy should include general tort, premises damage, personal advertising injury and product liability insurance which covers Franchisee for damages that result in injury from products Franchisee distributes). Plus, property and casualty insurance with a minimum policy limit of $2,000,000 or an amount specified by the us.
Franchisee must also procure and maintain "All Risks" or "Special Form" insurance (coverage for the full cost of replacement of the premises and all other property); employer liability insurance, automobile liability insurance with coverage of owned and hired vehicles with minimum coverage in amounts not less than $100,000 combined single limit for bodily and property damage (or what is in accordance with Franchisee's state guidelines); business interruption insurance to fully insure loss of earnings for a period of one-hundred and eighty (180) days or longer as may specify; and statutory workers' compensation insurance with limits of greater than $100,000 or the minimum limits required by law.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, franchisees are subject to fees beyond the initial franchise fee. The FDD outlines the obligation to pay royalty fees and other amounts owed under the franchise agreement.
Additionally, franchisees are responsible for covering various costs associated with operating the franchise. This includes expenses related to locating, obtaining, and developing the site for the Burros Fries business. Franchisees must also handle the costs of equipping the business premises.
Furthermore, franchisees are obligated to secure and maintain specific insurance coverage throughout the term of the franchise agreement. This insurance must come from a responsible carrier with a performance rating of A or higher. The required insurance includes general liability insurance with minimum policy limits of $2,000,000 per occurrence and $4,000,000 aggregate, as well as property and casualty insurance with a minimum policy limit of $2,000,000 or an amount specified by Burros Fries. Franchisees must also maintain "All Risks" or "Special Form" insurance, employer liability insurance, automobile liability insurance with minimum coverage of $100,000, business interruption insurance, and statutory workers' compensation insurance.