Under what circumstances might Cinnaholic waive or reduce the initial franchise fee?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
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ITEM 5 INITIAL FEES
Franchise Fee and Market Development Fee. You must pay us an initial franchise fee equal to $40,000 for each Bakery franchised by you. The initial franchise fee is uniform for all franchisees purchasing a franchise through this Disclosure Document. We have no intention, now or in the future, of reducing the initial franchise fee for any prospective franchisee, although we reserve the right to do so in our sole discretion on a case-by-case basis. We reserve the right to waive or reduce the initial franchise fee for our affiliates, employees, existing franchises or if we run a franchise marketing promotion. Initial franchise fees are not refundable under any circumstances.
In the year ended December 31, 2024, three franchisees received initial franchise fee discounts. One franchisee received a two-store initial franchise fee discount of $5,000 ($2,500 per store), one franchisee received an initial franchise fee discount of $5,000, and one franchisee received an initial franchise fee discount of $1,000. Our current policy is that we may offer discounts for franchisees purchasing three or more units. We also offer Veteran discounts of 10% for t
Source: Item 5 — INITIAL FEES (FDD pages 11–12)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the initial franchise fee is $40,000, but there are circumstances where Cinnaholic may waive or reduce this fee. While Cinnaholic states they have no current intention to reduce the initial franchise fee, they reserve the right to do so at their sole discretion on a case-by-case basis. This means that while it's not guaranteed, there is a possibility for negotiation or special consideration. Cinnaholic also reserves the right to waive or reduce the initial franchise fee for affiliates, employees, existing franchisees, or if they run a franchise marketing promotion.
In 2024, some franchisees received discounts on the initial franchise fee. One franchisee received a two-store discount of $5,000 ($2,500 per store), another received a $5,000 discount, and a third received a $1,000 discount. Cinnaholic's current policy is to offer discounts for franchisees purchasing three or more units. This indicates a willingness to negotiate fees for multi-unit purchases, which is a common practice in franchising to incentivize larger commitments. Cinnaholic also offers a 10% discount on the initial franchise fee for the first bakery franchised by veterans.
For prospective franchisees, this means there are several potential avenues to explore for reducing the initial franchise fee. Veterans should definitely inquire about the 10% discount. Anyone considering opening multiple Cinnaholic locations should discuss potential discounts for purchasing three or more units. While discounts are not guaranteed, the FDD indicates that Cinnaholic has provided them in the past and has a policy in place for multi-unit purchases. It's important to remember that initial franchise fees are generally not refundable under any circumstances.