What is the weekly Non-compliance fee charged after the initial 30-day notice for a Chocolate Bash franchise?
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, and not to us. |
| Non-compliance fee | $500 | On demand | We may charge you $500 if your business is not in compliance with our system specifications or the franchise agreement and you fail to correct the non-compliance after 30 days' notice. Thereafter, we may charge you $250 per week until you correct such non |
Source: Item 6 — OTHER FEES (FDD pages 9–13)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, a franchisee may incur a non-compliance fee if their business fails to adhere to the system specifications or the franchise agreement. Chocolate Bash will provide an initial 30-day notice to correct the non-compliance.
After this 30-day notice period, if the franchisee has not rectified the issue, Chocolate Bash may charge a non-compliance fee of $500. Furthermore, the franchisee may be charged $250 per week until the non-compliance is corrected.
This fee structure is designed to encourage franchisees to maintain Chocolate Bash's standards and comply with the franchise agreement. It is important for prospective franchisees to understand these potential costs and ensure they can meet all requirements to avoid incurring these fees. Franchisees should carefully review the franchise agreement and system specifications to fully understand their obligations and the potential consequences of non-compliance.