Does Chocolate Bash receive the software subscription fees paid by the franchisee?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty | 6% of your gross sales | Monthly by the 5th day of the following month | See Note 1 and Note 2. |
| Marketing Fund Contribution | 1% of your gross sales | Monthly by the 5th day of the following month | |
| Market Cooperative Contribution | As determined by co-op. Currently, none. | Monthly by the 5th day of the following month | We have the right to establish local or regional advertising cooperatives. There is no maximum on the contribution determined by the co-op. |
| New Manager Training fee | Currently, $15,000 | Prior to attending training | If you send a manager or other employee to our training program after you open, we will charge our then-current training fee. |
| Third party vendors | Pass-through of costs, plus reasonable administrative charge. Currently, none. | Varies | We have the right to require franchisees to use third-party vendors and suppliers that we designate. Examples can include computer support vendors, mystery shopping, and customer feedback systems. The vendors and suppliers may bill franchisees directly, or we have the right to collect payment for these vendors together a reasonable markup or charge for administering the payment program. |
| Software subscription | Currently, $200 - $250 per month | Monthly | We require you to use certain software as described in Item 11. You pay subscription fees directly to the software supplier, an |
Source: Item 6 — OTHER FEES (FDD pages 9–13)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, franchisees are required to use specific software, but they do not pay the subscription fees to Chocolate Bash. Instead, the franchisee pays these fees directly to the software supplier. The fees currently range from $200 to $250 per month.
This arrangement means that Chocolate Bash does not profit directly from the software subscription fees. This pass-through system is relatively common in franchising, where franchisors may designate specific vendors for certain services or products to maintain consistency and quality across all franchise locations.
For a prospective Chocolate Bash franchisee, this is a notable point in managing ongoing expenses. The franchisee needs to budget for these monthly software costs, understanding that these payments are made to a third-party vendor rather than to Chocolate Bash itself. This also implies that any issues or support related to the software would be handled directly with the software supplier, not through Chocolate Bash.