Under what condition might the Burros Fries transfer fee exceed $15,000?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
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| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Transfer Fee | A flat fee of $15,000 when you transfer your franchised business. If transferee came from our lead database, you may be required to pay the then-current fee to us plus any costs associated with applicable broker fees. | At the time the transferee signs the Franchise Agreement in effect | Payable to us when the Franchise Agreement is signed. |
Source: Item 6 — OTHER FEES (FDD pages 12–16)
What This Means (2024 FDD)
According to Burros Fries's 2024 Franchise Disclosure Document, the standard transfer fee is $15,000. However, this fee may increase under a specific circumstance. If the transferee, the person or entity buying the franchise, is sourced from Burros Fries's lead database, the franchisee may be required to pay the then-current transfer fee, which could be higher than $15,000, in addition to any broker fees associated with the transfer.
This means that if a franchisee finds a buyer through Burros Fries's internal channels, they might face a higher transfer fee than the standard amount. This additional cost is to cover any expenses Burros Fries incurs in facilitating the lead and potentially compensating brokers involved in the process. It's important for franchisees looking to sell their business to understand this potential added expense, as it could impact their proceeds from the sale.
Prospective franchisees should inquire about the typical range of these additional broker fees and the criteria for determining the 'then-current fee' to fully understand the potential costs associated with transferring their Burros Fries franchise, especially if they anticipate using the franchisor's lead database to find a buyer. This will help them make informed decisions about the transfer process and financial implications.