What is the fee for transferring a Closet Storage Concepts franchise?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty | 5% of Gross | Payable on each | (See Note 1) |
| Revenues | Monday via ACH for | ||
| subject to a | the week ending the | ||
| minimum of | immediately prior | ||
| $125 per week | Saturday. | ||
| (NAP) National Advertising Program | Currently $75 | Payable weekly on | (See Note 2) |
| Contribution | per week- | Monday via ACH for | |
| per | |||
| store. Can be | the previous week | ||
| increased but | |||
| any increased | |||
| amount will not | |||
| exceed 1% of | |||
| weekly Gross | |||
| Revenues | |||
| provided that | |||
| no increases | |||
| will occur in | |||
| the first | |||
| year | |||
| of | |||
| the agreement. | |||
| Transfer of Franchise | 50% of the | Before transfer. | Either you or the |
| then current | transferee pays | ||
| Initial | this fee to us. | ||
| Franchise Fee, | |||
| subject to a |
Source: Item 6 — OTHER FEES (FDD pages 13–18)
What This Means (2025 FDD)
According to Closet Storage Concepts's 2025 Franchise Disclosure Document, the fee for transferring a franchise is 50% of the then-current Initial Franchise Fee, but is subject to a minimum of $24,750. This fee is due before the transfer takes place.
The FDD specifies that either the franchisee (seller) or the transferee (buyer) is responsible for paying this fee to Closet Storage Concepts. This is a point of negotiation between the seller and the buyer during the transfer process.
This transfer fee structure, based on a percentage of the initial franchise fee with a minimum amount, is fairly common in franchising. It allows the franchisor to recoup some of their initial investment in establishing the franchise system and to ensure that the new franchisee is properly vetted and trained. Prospective franchisees should consider this fee when planning for a potential sale of their Closet Storage Concepts franchise in the future.
It is important to note that the 'then current Initial Franchise Fee' could be higher at the time of transfer than what the original franchisee paid, meaning the transfer fee could exceed the $24,750 minimum. Franchisees should confirm the current Initial Franchise Fee with Closet Storage Concepts before initiating a transfer.