What is the estimated range for the fuel security deposit for a Circle K franchise, and when is it due?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
or rebuilt convenience store locations)
| Type of Expenditure | Amount | Method of Payment | When Due | To Whom Payment is to be Made |
|---|---|---|---|---|
| Initial Franchise Fee | $25,000 | Lump Sum | Upon signing | TMC |
| (Note 1) | Agreement | |||
| R |
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 36–45)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, the estimated fuel security deposit ranges from $20,000 to $50,000. This deposit is paid to TMC (the franchisor) as a lump sum. The fuel security deposit is due upon signing the Motor Fuel Agreement.
The security deposit serves to secure the franchisee's obligations under the Motor Fuel Agreement, ensuring payment of all due sums and adherence to the agreement's terms. Circle K has the right to draw upon this deposit if the franchisee fails to make timely payments or meet other obligations outlined in the Motor Fuel Agreement. If Circle K uses any portion of the security deposit, the franchisee must immediately replenish the deposit to its original level.
Upon termination, expiration, or non-renewal of the Motor Fuel Agreement, Circle K may use the security deposit to cover any outstanding amounts, losses, damages, injuries, or liabilities resulting from the franchisee's failure to fulfill the agreement's conditions. After settling any such claims, the remaining balance of the security deposit will be refunded to the franchisee. However, if the premises where the motor fuel business is located are owned by Circle K or its affiliate, Circle K has the option to reduce or waive the security deposit altogether.