How does Cicis's Item 11 regarding pre-opening obligations depend on the franchisee's ability to secure financing, given Item 10 states that Cicis does not offer financing?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
Under the Franchise Agreement, you must open your Cicis Restaurant and commence business within 365 days following the date on which you sign the Franchise Agreement. The typical length of time to open (i) a Cicis Buffet Restaurant is 9 – 10 months after execution of the Franchise Agreement, and (ii) a Cicis To Go Restaurant is 8 – 10 months after execution of the Franchise Agreement. The length of time to open your Cicis Restaurant will depend on factors such as your ability to obtain a lease, building permits, weather conditions, shortages or delayed installation of equipment, signs or other fixtures, labor shortage, etc.
Before you open your Cicis Restaurant, we will:
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- Review and, at our discretion, accept the proposed site for your Cicis Restaurant. Our determination to accept or not accept a site may be based on various criteria (such as demographics, proposed rental rates, neighborhood and nearby business counts and characteristics, nearby residential populations, traffic count, accessibility, parking, visibility, signage, and competition) which may change in our discretion. We typically accept or reject the proposed site within 30 days of your providing us all required information. It is your responsibility to secure our approval of the proposed site for your Cicis Restaurant within 120 days following the execution of the Franchise Agreement, and if you fail to do so we may terminate the Franchise Agreement. We do not lease Cicis Restaurant premises to our franchisees. (Franchise Agreement, Section 1.B.)
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- Loan you a set of prototypical architectural and design plans and specifications for your Location. You must adapt these plans at your expense for construction of the Location. (Franchise Agreement, Section 2.B.)
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- Provide on-site inspections we believe are necessary to evaluate progress of construction or remodeling, and we have the right to require you to pay us a reasonable fee for such on-site inspections and to pay or reimburse us for expenses we incur, such as the cost of travel, lodging, and meals. (Franchise Agreement, Section 2.B.)
You must carry out a grand opening promotion for your Cicis Restaurant in compliance with our written specifications.
In addition to the initial franchise fee and other initial costs, you will need additional funds to operate your Location during the start-up phase of the business.
These funds will be used, among other things, to train your crew, compensate for higher than normal food and labor costs during the start-up phase, and provide general working capital.
These amounts do not include any estimates for debt service and related closing costs or for payment of a Managing Owner's or Operator's salary during pre-opening.
We estimate the start-up phase to be 3 months from the date the Location opens for business.
Neither we nor our affiliates offer financing directly or indirectly for any part of the initial investment.
You must spend at least $10,000 on marketing expenditure for the grand opening of your Cicis Restaurant. The expenses you incur for the grand opening promotion will not be credited toward your required Local Marketing Spend or any of your other marketing obligations and must be provided prior to the opening of your Cicis Restaurant.
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, Item 11 outlines the pre-opening obligations for both Cicis as the franchisor and the franchisee. A franchisee's ability to fulfill their pre-opening obligations is directly tied to their financial resources, especially since Cicis does not offer direct or indirect financing. The time it takes to open a Cicis restaurant, whether a Buffet or To Go location, depends on factors like securing a lease, obtaining building permits, and addressing potential equipment delays.
The franchisee is responsible for securing a site approved by Cicis within 120 days of signing the Franchise Agreement. They must also adapt prototypical architectural plans at their own expense. Cicis may conduct on-site inspections, for which the franchisee may be required to pay fees and reimburse expenses. The franchisee must also carry out a grand opening promotion, with a minimum spend of $10,000 on marketing expenditure, prior to opening.
The FDD emphasizes that in addition to the initial franchise fee, franchisees will need additional funds to operate during the start-up phase, estimated to be three months from the opening date. These funds cover crew training, higher initial food and labor costs, and general working capital. The estimates provided do not include debt service, related closing costs, or a salary for the Managing Owner or Operator during pre-opening. The document explicitly states that Cicis does not offer financing, making it crucial for prospective franchisees to independently secure sufficient capital to meet these pre-opening and initial operating expenses.
Ultimately, a franchisee's ability to meet these obligations and open their Cicis restaurant on schedule hinges on their ability to obtain financing from external sources, manage their budget effectively, and navigate potential delays or unexpected costs. The financial burden rests entirely on the franchisee, highlighting the importance of thorough financial planning and securing adequate funding before entering into a franchise agreement with Cicis.