How is the initial territory fee determined for a City Wide franchise?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
ce period). In the latter case, all of Franchisee's obligations shall remain in full force and effect during the Interim Period as if this Agreement had not expired, and all obligations and restrictions imposed on Franchisee upon expiration of this Agreement shall be deemed to take effect upon termination of the Interim Period.
SECTION 3. Franchise Fees and Ongoing Payment Obligations of Franchisee
3.1 Initial Fees. Contemporaneously with Franchisee's execution of this Agreement, Franchisee must pay CITY WIDE an initial franchise fee ("Initial Franchise Fee") of Seventy Thousand Dollars ($70,000); plus, an initial training fee ("Initial Training Fee") of Seven Thousand Five Hundred Dollars ($7,500) plus an initial territory fee ("Initial Territory Fee") in the amount set forth on Attachment B plus a Technology Provisioning Fee ("Technology Provisioning Fee") of Twelve Thousand Five Hundred Dollars ($12,500) as set forth below. Initial Franchise Fee, Initial Training Fee, Initial Territory Fee and Technology Provisioning Fee are collectively referred to herein as the "Initial Fees."
The determination of a Designated Territory's size and the Initial Territory Fee to be paid for such Designated Territory shall be at the sole and absolute right of CITY WIDE.
Franchisee must pay by certified or cashier's check, or by other payment methods as designated at CITY WIDE's sole and absolute right, the receipt of which CITY WIDE acknowledges by signing this Agreement.
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to City Wide's 2025 Franchise Disclosure Document, the determination of a Designated Territory's size and the Initial Territory Fee is at the sole discretion of City Wide. The initial territory fee is in addition to the $70,000 initial franchise fee, $7,500 initial training fee, and $12,500 technology provisioning fee that franchisees must pay upon signing the Franchise Agreement.
The FDD also specifies that the initial territory fee is based on a chart that considers the population within the designated territory, using the latest United States Census information. Territories with less than 1,000,000 population have a $15,000 fee, territories with populations between 1,000,001 and 1,499,999 have a $30,000 fee, territories with populations between 1,500,000 and 2,000,000 have a $35,000 fee, and territories with populations of 2,000,001 and above have a $50,000 fee.
This means that a prospective City Wide franchisee's initial investment will vary significantly depending on the population of the territory they are assigned. Franchisees should carefully review Attachment B to the Franchise Agreement, which outlines the specific details of their designated territory, including its population, geographic boundaries, and the corresponding initial territory fee. Understanding these factors is crucial for assessing the financial viability of the franchise opportunity.