Is any portion of the initial franchise fee refundable for a Carvel franchise?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
er 2026, including precautions and response measures for credentialstuffing attacks.
Other than these actions, no litigation is required to be disclosed in this Item.
ITEM 4
BANKRUPTCY
No bankruptcy is required to be disclosed in this Item.
ITEM 5
INITIAL FEES
Initial Franchise Fees. When you sign a Franchise Agreement, you must pay us an initial franchise fee (the "Initial Franchise Fee") of $30,500 for a Full Shoppe, $10,500 for an Express Shoppe or Hosted Express Shoppe, $5,500 for an Ice Cream Truck, and $61,000 for a Co-Branded Shoppe (of which $30,500 will be paid to Cinnabon). We will not refund any part of the Initial Franchise Fee.
We participate in the International Franchise Association's VetFran program. For qualifying veterans or members of the Armed Forces, the Initial Franchise Fee for a Full Shoppe is $20,000.
We reserve the right to reduce the Initial Franchise Fee under certain circumstances, including: (i) as an economic incentive for a franchisee to open a certain location, with the determination made on a case-by-case review of all relevant economic factors; (ii) as an inducement for existing operators to open additional Shoppes; (iii) as an inducement for someone to reopen a closed
Shoppe; (iv) as an inducement for someone to take over an operating Shoppe; (v) as an inducement for a professional multi-unit operator to open several Shoppes; or (vi) to allow a franchisee to have additional money to spend on Shoppe improvements and marketing during the first 12 months of operation. The amount of any reduction will be made on an individual basis and may depend on the condition of the premises, the need for upgrades and remodeling, any special circumstances that we may consider appropriate, and/or other considerations. In addition, we may allow a new franchisee to apply part of their Initial Franchise Fee to the cost of needed improvements or equipment. We may modify or cease offering any discount or incentive programs at any time.
During the 2024 calendar year, franchisees paid Initial Franchise Fees ranging from $0 to $30,500.
If you sign multiple Franchise Agreements with a Multi-Unit Addendum to develop a set number of Shoppes, you must pay us all of the Initial Franchise Fees for all of the Shoppes that you commit to develop at the time you sign the Franchise Agreements with a Multi-Unit Addendum. If you fail to develop any of the Shoppes by the deadlines set forth therein or any Franchise Agreement(s) subject to the Multi-Unit Addendum are terminated, you will not receive a refund of any Initial Franchise Fees that you have prepaid.
In certain rare circumstances, we may permit installment payments of the Initial Franchise Fee on terms negotiated with the franchisee.
Plan Review Fee.
Source: Item 5 — Initial Fees (FDD pages 28–31)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, the initial franchise fee is generally not refundable. The FDD states explicitly that Carvel "will not refund any part of the Initial Franchise Fee." This non-refundability applies to the initial franchise fees for Full Shoppes ($30,500), Express Shoppes or Hosted Express Shoppes ($10,500), Ice Cream Trucks ($5,500), and Co-Branded Shoppes ($61,000). Even if a franchisee signs multiple franchise agreements with a Multi-Unit Addendum and fails to develop the agreed-upon number of Shoppes, the initial franchise fees that have been prepaid will not be refunded.
While the initial franchise fee is typically non-refundable, Carvel does reserve the right to reduce the initial franchise fee under certain circumstances. These circumstances include providing economic incentives for opening in specific locations, inducing existing operators to open additional Shoppes, reopening closed Shoppes, taking over operating Shoppes, attracting professional multi-unit operators, or allowing franchisees to allocate more funds to Shoppe improvements and marketing during the first year. The amount of any reduction is determined on a case-by-case basis, considering factors like the condition of the premises and the need for upgrades.
In certain rare cases, Carvel may permit installment payments of the initial franchise fee, with terms negotiated individually with the franchisee. However, the standard policy is that the initial fees are non-refundable. During the 2024 calendar year, franchisees paid Initial Franchise Fees ranging from $0 to $30,500, indicating that some franchisees may have received a reduction in the initial fee due to the aforementioned circumstances. Prospective franchisees should be aware that while discounts or incentives may be available, they are not guaranteed and are subject to change or termination by Carvel at any time.