How does the Caring Transitions initial franchise fee (Item 5) relate to the potential for long-term profitability?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
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We presently offer a rebate program called "The Winners' Circle" for new Caring Transitions owners that meet our qualifications and that achieve certain revenue goals. For qualifying owners, we will rebate $10,000 of the franchise fee they paid if they attain cumulative gross receipts of at least $900,000 during the two-year period after the Commencement Date; we will rebate an additional $10,000 of the franchise fee if they received the first rebate and attain cumulative gross receipts of at least $1,600,000 during the three-year period after the Commencement Date; we will rebate an additional $10,000 of the franchise fee if they received the first two rebates and attain cumulative gross receipts of at least $2,300,000 during the four-year period after the Commencement Date; and we will rebate the remainder of the franchise fee they paid if they received the first three rebates and attain cumulative gross receipts of at least $3,100,000 during the five-year period after the Commencement Date. The "Commencement Date" is the first day of the month following the month in which the training program for new owners is completed. If the owner fails to achieve any one of these revenue goals, then he or she will not be eligible to receive any additional rebate. To be eligible for any rebate, the owner must strictly comply with all obligations to us, including timely reporting all gross receipts and paying all royalties and fees required by the franchise agreement, must have attended all franchise system national conferences and regional conferences and all required on-site training centers, must sign a general release, and must have strictly complied with all other material terms and conditions of each agreement and instrument between us. If the Franchise Agreement is
1 All dollar figures refer to U.S. Dollars.
terminated for any reason prior to the end of its initial term, then Franchisee must return all rebates to Franchisor, if any. NOTE: The revenue goals above are not to be construed as projections or estimates of actual or potential earnings, sales, or receipts. We make no representation that you or any other Caring Transitions owner has or will be able to achieve any of the revenue goals required to receive a rebate under this program. We reserve the right to cancel or modify this rebate program at any time, but owners who have already been accepted into The Winners' Circle will be permitted to complete the program.
We may cancel your franchise agreement if, at any time during or within 15 days after you (or the person designated by you as responsible for the management of the franchised business) complete the initial training program, we conclude that you have not exhibited the aptitude, abilities, or personal characteristics necessary or desirable to successfully operate a Caring Transitions franchise. The initial franchise fee for a Caring Transitions franchise is non-refundable and fully earned when we sign the franchise agreement, in consideration of administrative and other expenses we incurred in granting you the franchise and investigating your qualifications, and for our lost or deferred opportunity to franchise to oth
What This Means (2025 FDD)
According to Caring Transitions's 2025 Franchise Disclosure Document, the initial franchise fee can be directly related to long-term profitability through a rebate program called "The Winners' Circle". New Caring Transitions franchisees who meet certain qualifications and revenue goals can receive rebates of their initial franchise fee. Specifically, a franchisee can receive a $10,000 rebate for attaining cumulative gross receipts of at least $900,000 during the two-year period after the Commencement Date.
The rebate program continues with further opportunities for franchisees to recover more of their initial franchise fee. A franchisee can receive an additional $10,000 rebate if they received the first rebate and attain cumulative gross receipts of at least $1,600,000 during the three-year period after the Commencement Date. They can receive another $10,000 rebate if they received the first two rebates and attain cumulative gross receipts of at least $2,300,000 during the four-year period after the Commencement Date. Finally, they can receive the remainder of the franchise fee they paid if they received the first three rebates and attain cumulative gross receipts of at least $3,100,000 during the five-year period after the Commencement Date.
However, to be eligible for any rebate, the Caring Transitions franchisee must strictly comply with all obligations to Caring Transitions, including timely reporting all gross receipts and paying all royalties and fees required by the franchise agreement. They also must have attended all franchise system national conferences and regional conferences and all required on-site training centers, must sign a general release, and must have strictly complied with all other material terms and conditions of each agreement and instrument between them. If the Franchise Agreement is terminated for any reason prior to the end of its initial term, then Franchisee must return all rebates to Franchisor, if any.
The initial franchise fee for a Caring Transitions franchise is non-refundable and fully earned when Caring Transitions signs the franchise agreement, in consideration of administrative and other expenses they incurred in granting the franchise and investigating the franchisee's qualifications, and for their lost or deferred opportunity to franchise to others. The revenue goals are not to be construed as projections or estimates of actual or potential earnings, sales, or receipts, and Caring Transitions makes no representation that any Caring Transitions owner has or will be able to achieve any of the revenue goals required to receive a rebate under this program. Caring Transitions reserves the right to cancel or modify this rebate program at any time, but owners who have already been accepted into The Winners' Circle will be permitted to complete the program.