When is the transfer fee due for 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 transfer fee is due before the transfer of the franchise. The fee is 50% of the then-current Initial Franchise Fee, subject to a minimum of $24,750.
This means that if a franchisee decides to sell their Closet Storage Concepts franchise to another party, either the franchisee or the new transferee must pay the transfer fee to Closet Storage Concepts before the transaction can be completed. The fee covers Closet Storage Concepts's administrative costs and ensures that the new franchisee meets their standards.
It's important to note that the transfer fee is a significant expense, potentially reaching a substantial amount depending on the initial franchise fee at the time of transfer. Prospective franchisees should consider this cost when evaluating the potential resale value of a Closet Storage Concepts franchise. They should also clarify with Closet Storage Concepts whether the initial franchise fee used to calculate the transfer fee is the fee at the time of the original franchise agreement or the fee at the time of the transfer.