Can Chocolate Fish Coffee impose a markup for administering a payment program to vendors?

According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, Chocolate Fish Coffee has the right to collect payments from franchisees on behalf of a vendor and remit those payments. Furthermore, Chocolate Fish Coffee has the right to impose a reasonable markup or charge for administering this payment program.

This means that Chocolate Fish Coffee franchisees could be subject to additional charges beyond the cost of goods or services purchased from vendors if Chocolate Fish Coffee chooses to implement and administer a payment program. The FDD specifies that the markup or charge must be reasonable, but it does not define what constitutes a reasonable amount.

As a prospective franchisee, it would be prudent to inquire with Chocolate Fish Coffee about the specifics of this potential markup. Understanding how the payment program is administered, the frequency with which it is used, and the typical markup percentage would be valuable in assessing the overall cost of goods and services and the potential impact on profitability. It would also be wise to understand if this markup is applied consistently across all franchisees or if it varies based on factors such as location or vendor.