What is the Successor Fee for a City Wide franchise?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
4 months | $2,900/mo. | | | 25 and all months thereafter | $3,350/mo. | | | Type of Fee1 | Amount | Due Date | Remarks | |-------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | you under the franchise | | | | | agreement | | | | | (including the Initial | | | | | Fees). The Transfer Fee is in | | | | | addition to any third-party | | | | | broker fee. No Transfer Fee is | | | | | assessed for a transfer to your | | | | | survivor. | | Audit | Amount of underpayment, plus interest at highest legal rate, not to exceed 10%. If underpayment is 2% or more, you must reimburse CITY WIDE for its audit costs. Audit costs may run as much as $6,000. | Upon billing by CITY WIDE. | Payable only if audit shows an understatement of at least 2% of Gross Sales for any month.
Source: Item 6 — OTHER FEES (FDD pages 16–20)
What This Means (2025 FDD)
According to City Wide's 2025 Franchise Disclosure Document, the Successor Fee is 50% of the then-current Initial Franchise Fee. This fee is paid if a franchisee meets the conditions to be granted an additional term once the current term of their Franchise Agreement expires. The Successor Fee is due at the time of signing the Successor Franchise Agreement.
In simpler terms, if a City Wide franchisee wants to renew their franchise agreement for another term, they will need to pay a Successor Fee. This fee is calculated as half of whatever the standard initial franchise fee is at that time. For example, if the initial franchise fee is $50,000 when the franchisee seeks to renew, the Successor Fee would be $25,000.
It is important for prospective City Wide franchisees to understand this fee, as it represents a significant cost associated with continuing the franchise beyond the initial term. Franchisees should factor this potential expense into their long-term financial planning and consider it when evaluating the overall profitability of the franchise. The fee is due upon signing the new agreement, so franchisees need to have the funds available at that time.