What are all the fees a Byrider franchisee might pay, considering both initial fees (Item 5) and other fees (Item 6)?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
M 5
INITIAL FEES
Franchise Agreement. You will pay a $60,000 lump sum franchise fee when you sign the Franchise Agreement. This initial franchise fee is refundable if Byrider Franchising Partners receives written notice from you within 60 days from the date of the Franchise Agreement and you sign the form of general release required by Byrider Franchising Partners. If you purchase additional franchises, you must pay the thencurrent nonrefundable initial franchise fee for each additional franchise. As of the date of this Disclosure Document, the initial franchise fee for each additional franchise is $35,000 (if you are a Traditional Franchisee, as provided below) or $40,000 (if you are an Ultra Franchisee, as provided below). The initial franchise fee for additional franchises is subject to change at the discretion of Byrider Franchising Partners without prior notice. Except as described above, the initial franchise fee is not refundable under any circumstances.
Other than for Byrider Businesses operated by affiliates or other related companies (where the initial franchise fee is and has been waived) the initial franchise fee is and has been uniform.
Reduced Franchise Fee for Veterans. If you are a veteran of the U.S. Armed Forces, your initial franchise fee will be reduced by $10,000. For purposes of determining whether you qualify, a "veteran" means a person who served in the active military, naval, air, or space service, and who was discharged or released therefrom under conditions other than dishonorable. If this applies to you, you will sign the Veteran Discount Addendum (attached as Exhibit K).
Area Development Agreement Rider. If you are granted the right to purchase additional franchises, you must sign the applicable Area Development Agreement Rider. If you or your affiliate(s) have signed a Franchise Agreement with Byrider Franchising prior to January 1, 2021 for at least one Byrider Business, and you are otherwise in compliance with that agreement and all other franchise agreements with Byrider Franchising Partners, you will be considered a "Traditional Franchisee." If you or your affiliate(s) have not signed a Franchise Agreement with Byrider Franchising prior to January 1, 2021 for at least one Byrider Business, then you will be considered a "Ultra Franchisee." If you are a Traditional Franchisee, you will sign the Traditional Area Development Agreement Rider, attached to this disclosure document as Exhibit C-1 (the "Traditional Area Development Agreement"), or if you are an Ultra Franchisee, you will sign the Ultra Area Development Agreement Rider, attached to this disclosure document as Exhibit C-2 (the "Ultra Area Development Agreement").
Under the Traditional Area Development Agreement, you must pay us a development fee of $17,500 multiplied by the number of Byrider Businesses to be developed under the Development Schedule in addition to the first Byrider Business. Under the Ultra Area Development Agreement, you must pay us a development fee of $20,000 multiplied by the number of Byrider Businesses to be developed under the Development Schedule in addition to the first Byrider Business. The applicable development fee is due and payable at the time you sign the respective Area Development Agreement. We credit the development fee, in $17,500 (for Traditional Franchisees) or $20,000 (for Ultra Franchisees) increments, against the respective initial franchise fee that is due as Franchise Agreements are signed until the aggregate amount of such credits equals the initial development fee you paid to us under the respective Area Development. We will fully earn the development fee due under the respective Area Development Agreement when paid, and you must pay us the development fee in one lump sum. The fee is non-refundable.
Refer a Franchise Promotions. From time to time, Byrider Franchising Partners offers a "Refer a Franchise" promotion to its existing Byrider Franchising Partners franchisees. If you are referred to us by an existing franchisee and you open your Byrider business within 18 months of that referral, we will pay that franchisee a one-time referral fee in the amount of $10,000.
ITEM 6
OTHER FEES
| Name of Fee 1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Ultra2 Royalty Fee | $5,500-$7,800 plus 1.65%-1.90% Gross Receipts | Monthly | Gross Sales (Byrider Vehicle Sales): (i) during first year of operation of the Business, $5,500 per month; (ii) during second year of operation of the Business, the greater of $6,700 or 1% of Gross Sales (Byrider Vehicle Sales); |
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, franchisees can expect to pay several initial and ongoing fees. The initial franchise fee is $60,000, but this is refundable if Byrider receives written notice within 60 days of signing the Franchise Agreement and the franchisee signs a required general release form. For additional franchises, the initial fee is $35,000 for Traditional Franchisees or $40,000 for Ultra Franchisees. Veterans of the U.S. Armed Forces receive a $10,000 reduction in the initial franchise fee. If a franchisee is granted the right to purchase additional franchises, they must sign an Area Development Agreement Rider and pay a development fee of $17,500 (Traditional) or $20,000 (Ultra) multiplied by the number of Byrider Businesses to be developed, which is credited against future initial franchise fees.
Other fees include a Royalty Fee, which varies based on gross sales and gross receipts. During the first year, the Royalty Fee is $5,500 per month. In the second year, it's the greater of $6,700 per month or 1% of Gross Sales (Byrider Vehicle Sales). After the second year, it increases to the greater of $7,800 per month or 1% of Gross Sales (Byrider Vehicle Sales), with the $7,800 minimum increasing by 4% every other year starting January 1, 2026. Additionally, after the first year, there's a fee of 1.90% of Gross Receipts (CNAC Collections). Franchisees may also incur a Third Party Financed Sales Fee of $250 per contract sold or assigned to a third party and a Bulk Sale of Accounts Fee equal to 1.9% of gross amounts of Byrider-originated consumer retail installment contracts sold to a third party.
Byrider also reserves the right to charge a technology fee or an accounting fee for analyzing accounting information and providing financial reports. Franchisees are responsible for the costs of required modifications to the System. There is also a potential referral fee; if an existing franchisee refers a new franchisee who opens a Byrider business within 18 months, Byrider will pay the referring franchisee a one-time referral fee of $10,000. These fees are generally uniform and non-refundable unless otherwise stated.
Prospective franchisees should carefully consider these fees and factor them into their financial projections. Understanding the conditions and potential for fee increases is crucial for assessing the overall cost and profitability of a Byrider franchise. It is also important to note that the initial investment can be significantly higher if the franchisee chooses to purchase real property for the store, and costs can vary widely based on location and market conditions.