Under what circumstances will Carvel charge the franchisee for inspections?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
If: (i) we determine that a violation of Section 12.4.A. (Suspension of Operations) has occurred and that you have committed a similar violation within the one-year period before the date of the inspection or analysis; (ii) you fail or refuse to comply with any or all of the remedial measures we require; (iii) you fail to provide us with full cooperation in the course of any inspection or analysis we conduct; or (iv) we determine that there has been any repetition during the Term of any occurrence under Section 12.4.A., then you will pay us a fee for the inspection or analysis in the amount of $5,000; plus the travel and living expenses of our inspectors or representatives and any other expenses we incur in connection with this Section, including our attorneys' fees.
We may, in our sole discretion, conduct on-site inspections of the site. You will not be charged for our first on-site inspection, but we may charge you an inspection fee of $2,500 for a second or subsequent inspection.
Source: Item 23 — Receipts (FDD pages 100–353)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, franchisees may incur inspection fees under specific circumstances related to violations, non-compliance, or repeated inspections during construction.
Specifically, Carvel may charge a $5,000 fee, along with travel and living expenses for inspectors, and attorney's fees, if a franchisee violates the suspension of operations terms and has a similar violation within one year, fails to comply with required remedial measures, does not fully cooperate with inspections, or repeats any occurrence under the suspension of operations terms. This fee covers the cost of the inspection or analysis conducted by Carvel.
Additionally, during the construction phase, Carvel will not charge for the first on-site inspection. However, a $2,500 inspection fee may be charged for any second or subsequent inspections. This encourages franchisees to adhere to the architectural plans and standards from the outset, minimizing the need for repeated inspections.
These inspection fees are in addition to any other remedies Carvel may pursue for non-compliance, and failure to comply with standards can also result in non-compliance fees ranging from $25 to $500 per violation. These fees can be modified, charged repeatedly, and vary based on the severity and frequency of the defaults.