When is the initial franchise fee for Cinnaholic due?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Expenditure | Amount | Method of Payment | When Due | To Whom Payment Is To Be Made |
|---|---|---|---|---|
| Initial Franchise Fee (See Note 1) | $40,000 for each Bakery | Lump Sum | Will be prepaid as part of the Development Fee that is paid upon signing the Development Agreement | Us |
As discussed in Item 5 of this Disclosure Document, you will pay a Development Fee based on the number of Bakeries you must develop under the Development Agreement. The minimum number of Bakeries being one. In most circumstances, the Development Fee is credited against the initial franchise fee you must pay for each Bakery developed and opened according to your Development Schedule. If a Bakery is not established in accordance with the Development Schedule, the Development Fee that would have otherwise been credited towards payment of the initial franchise fee for that Bakery will be forfeited and retained by us.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 18–21)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the initial franchise fee of $40,000 for each bakery is prepaid as part of the Development Fee. This fee is due upon signing the Development Agreement with Cinnaholic. The Development Fee depends on the number of bakeries the franchisee commits to develop.
In most cases, the Development Fee is credited against the initial franchise fee for each bakery as it is developed and opened according to the agreed-upon Development Schedule. However, if a bakery is not established according to this schedule, the portion of the Development Fee that would have been credited towards the initial franchise fee for that specific bakery will be forfeited and retained by Cinnaholic.
Prospective Cinnaholic franchisees should carefully consider the Development Schedule and their ability to adhere to it, as failure to meet the schedule results in the loss of the Development Fee for any undeveloped bakeries. This arrangement is common in multi-unit franchise agreements, where the franchisor seeks assurance of the franchisee's commitment to expansion.