On what date is the Chem Dry monthly franchise fee subject to a CPI increase each year?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
License Fee.
ITEM 6 OTHER FEES
| Name of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Monthly Franchise Fee | The then current fee, which is presently $466.011 | 10th day of month | Generally, begins four months after you complete New Buyer Training, or if you are an existing Franchisee, the 4th month following the signing of the Franchise Agreement. If you are a transferring Franchisee, the month following the signing of the Franchise Agreement. Subject to CPI increase each year on April 1 and not more than once per calendar year. This fee must be paid via electronic funds transfer. The CPI increase for 2024 is 3%. |
Source: Item 6 — OTHER FEES (FDD pages 19–26)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, the monthly franchise fee is subject to a CPI (Consumer Price Index) increase each year on April 1st. The increase will not occur more than once per calendar year. As of the publication of this FDD, the monthly franchise fee is $466.01. The CPI increase for 2024 was 3%.
For a prospective Chem Dry franchisee, this means that the base monthly fee of $466.01 is subject to change annually based on fluctuations in the Consumer Price Index. This adjustment is designed to account for inflation and maintain the real value of the franchise fee over time. The franchisee should anticipate that their monthly payments will likely increase incrementally each year on April 1st.
It is important to note that while the CPI adjustment occurs annually, Chem Dry also retains the discretion to implement CPI changes after providing notice to franchisees, typically once per year. Franchisees should budget for potential increases to the monthly franchise fee and factor this into their financial projections. The FDD also mentions that the monthly franchise fee must be paid via electronic funds transfer.