How much of the Checkers development fee is credited towards the initial franchise fee for each restaurant?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
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Development Agreement
If we agree to grant you development rights, you and we will enter into a Development Agreement, which requires you to pay a development fee of $10,000 per restaurant to be developed. The number of restaurants to be developed pursuant to a Development Agreement varies depending upon a variety of factors, including (1) existing population and anticipated population growth within the Development Area; (2) competition within the Development Area; and (3) the number of Checkers Restaurants or Rally's Restaurants we estimate can be developed within the Development Area.
Under the Development Agreement, you are required to pay the then-current standard initial franchise fee for each Restaurant you are required to develop under a Development Agreement; however, $10,000 of the development fee is credited to the initial franchise fee payable for each Restaurant you are required to open under the Development Agreement until the development fee is credited in full. The development fee is not refundable, in whole or in part, except if we terminate the Development Agreement as a result of adverse franchise legislation. In this event, we will refund the uncredited portion of the development fee.
During our 2024 fiscal year, we did not collect a reduced development fee from
Source: Item 5 — INITIAL FEES (FDD pages 17–21)
What This Means (2025 FDD)
According to Checkers's 2025 Franchise Disclosure Document, if a franchisee signs a Development Agreement, they are required to pay a development fee of $10,000 per restaurant to be developed. This fee grants the franchisee development rights for a specific area. The number of restaurants to be developed depends on factors such as population, competition, and the estimated number of viable Checkers locations within the area.
Under the Development Agreement, the franchisee must pay the standard initial franchise fee for each restaurant. However, Checkers credits $10,000 of the development fee towards the initial franchise fee for each restaurant opened under the agreement, until the development fee is fully credited. This credit effectively reduces the upfront cost for each restaurant.
The development fee is generally non-refundable. However, if Checkers terminates the Development Agreement due to adverse franchise legislation, the uncredited portion of the development fee will be refunded to the franchisee. This provides some financial protection to the franchisee in specific circumstances.
It is important to note that during Checkers's 2024 fiscal year, they did not collect a reduced development fee from any franchisee that signed a Development Agreement. This may indicate a change in policy or promotional offers, so prospective franchisees should confirm the current policy with Checkers regarding development fee credits.