Is a Carbones Pizzeria franchisee required to pay the initial franchise fee upon renewal?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
- c. Franchisee shall not be obligated to pay the franchise fee described in Section 5(a) of this Agreement in the event of any such renewal, but shall pay the Renewal Fee.
Source: Item 23 — RECEIPTS (FDD pages 30–116)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, a franchisee is not required to pay the initial franchise fee upon renewal. The initial franchise agreement lasts for ten years, and a franchisee has the option to renew for one additional ten-year period. To renew the franchise agreement, the franchisee must not be in violation of any terms of the agreement, must execute the then-current form of the franchise agreement, update the restaurant to meet current requirements, and provide written notice of intent to renew within a specified timeframe.
Instead of paying the initial franchise fee again, the franchisee must pay a renewal fee of $1,500 at the time they provide notice of renewal. This renewal fee is significantly less than the initial franchise fee, which is $25,000.
This is a benefit to the franchisee as it significantly reduces the cost of continuing the franchise relationship. It is common in the franchise industry to charge a renewal fee, but the amount can vary widely. The renewal process ensures that the franchisee is in good standing and that the Carbones Pizzeria location is up to current standards, protecting the brand's reputation.