When is the Cinnaholic Development Fee due?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
MENT UNDER A MARKET DEVELOPMENT AGREEMENT
| Type of Expenditure | Amount | Method of Payment | When Due | To Whom Payment Is To Be Made | |
|---|---|---|---|---|---|
| Development Fee | $120,000 | Lump Sum | Paid upon signing the Development Agreement | Us | |
| (See Note 1) | |||||
| Total Estimated Initial In |
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 18–21)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the Development Fee is due when signing the Development Agreement. Item 7 outlines the estimated initial investment, including the Development Fee, which is a lump sum payment. For a three-bakery development agreement, the Development Fee totals $120,000. This fee compensates Cinnaholic for granting the franchisee the rights to develop a specific territory according to an agreed-upon schedule.
The Development Fee is typically credited towards the initial franchise fee for each bakery as it opens, according to the development schedule. However, if a bakery does not open on time, Cinnaholic retains the portion of the Development Fee that would have been credited towards that bakery's initial franchise fee. This incentivizes franchisees to adhere to the agreed-upon development timeline.
Prospective Cinnaholic franchisees should carefully consider the Development Schedule and their ability to meet it. Failure to open bakeries according to the schedule results in forfeiting a portion of the Development Fee, increasing the overall cost of opening the remaining bakeries. It is important to discuss the Development Schedule and potential consequences of delays with Cinnaholic before signing the Development Agreement.