What is the initial franchise fee for a Checkersrallys franchise if a Non-Traditional Site Addendum is signed?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
If you sign the Franchise Agreement and a Non-Traditional Site Addendum to operate the Franchised Restaurant from a Non-Traditional Site, then the initial franchise fee will be reduced to $15,000 as discussed below.
Non-Traditional Site Addendum
If the Franchised Restaurant is to be located at a Non-Traditional Site, you must enter into our Non-Traditional Site Addendum attached as Exhibit B-3. The Non-Traditional Site Addendum requires you to pay a reduced initial franchise fee of $15,000 and a reduced royalty fee level of 2% of Net Sales at the Franchised Restaurant (as reduced from the standard royalty fee of 4% for new Franchised Restaurants); and, to the extent we or our affiliates can reasonably arrange with the membership of your regional or local cooperative, a reduced cooperative advertising contribution level equal to 50% of the contribution level payable by fellow members of your regional or local cooperative (whose restaurants are not located at a Walmart or other Non-Traditional Site), if any such cooperative already exists or is formed in your Franchised Restaurant's area.
Source: Item 5 — INITIAL FEES (FDD pages 17–21)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the initial franchise fee is reduced to $15,000 if you sign a Non-Traditional Site Addendum to operate the franchised restaurant from a non-traditional site. This addendum, attached as Exhibit B-3, is required if the franchised restaurant is located at a non-traditional site.
In addition to the reduced initial franchise fee, the Non-Traditional Site Addendum also stipulates a reduced royalty fee of 2% of net sales, which is lower than the standard 4% royalty fee for new franchised restaurants. Furthermore, if a regional or local cooperative exists in the restaurant's area, Checkersrallys will attempt to arrange a reduced cooperative advertising contribution level equal to 50% of what other members pay, provided those members' restaurants are not located at a Walmart or other non-traditional site.
This arrangement can be financially beneficial for franchisees who operate in non-traditional locations, as it lowers both the initial investment and ongoing royalty fees. However, it is important to note that the reduced cooperative advertising contribution is contingent on Checkersrallys's ability to negotiate with the local cooperative, and there is no guarantee that such a reduction will be secured. Prospective franchisees should carefully review the Non-Traditional Site Addendum and discuss these terms with Checkersrallys to fully understand the financial implications.