What score on a Byrider compliance audit constitutes a failure?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
y deficiencies referred to herein for the first occurrence if said occurrence is cured within five (5) business days upon written notice by the Company to the Franchisee.
- 13.4 Compliance Audits. The Company may from time to time perform compliance audits reviewing operations of the Franchisee's Business, such as legal regulatory compliance issues, marketing, and adherence to Byrider, CNAC, and Service Center operational standards ("Compliance Audits" or in the singular "Compliance Audit"). If Franchisee fails a Compliance Audit, in the reasonable judgment of the Company, a failure currently meaning a score of less than 80%, Franchisee shall pay to Company a penalty in the amount of $500.00 plus reimbursement of
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, a score of less than 80% on a compliance audit is considered a failure. Byrider conducts these audits to review the franchisee's business operations, focusing on areas like legal and regulatory compliance, marketing practices, and adherence to Byrider and CNAC operational standards.
If a franchisee fails a compliance audit, Byrider may impose penalties. The first failure results in a $500 penalty, plus the franchisee must reimburse Byrider for travel, food, and lodging expenses related to a second, consecutive audit. If the franchisee fails the second audit, the penalty increases to $2,500, along with reimbursement for a third consecutive audit.
Failing three consecutive compliance audits carries the most severe consequences. The franchisee must pay a $10,000 penalty and reimburse Byrider's expenses for the third audit. Additionally, Byrider has the right to terminate the franchise agreement. This escalating penalty structure incentivizes franchisees to maintain high operational standards and address any deficiencies identified in the audits promptly.