Is a Cordova franchisee required to install specific payment systems?
Cordova Franchise · 2025 FDDAnswer from 2025 FDD Document
Note 1: Type of Fee – The above table describes fees and payments that you must pay to us, our affiliates, or that our affiliates may impose or collect on behalf of a third party. All fees are uniformly imposed for all franchises offered under this Disclosure Document, are recurring, are not refundable, and are payable to us, unless otherwise specified. Payment is subject to our specification and instruction, including, our election to have all fees automatically drafted from your business bank account or automatically debited or charged to your business bank account. You will be required to sign an ACH Authorization Form (Franchise Agreement, Exhibit 4) permitting us to electronically debit your designated bank account for payment of all fees payable to us and/or our affiliates. You must deposit the Gross Sales of your Cordova Business into the designated bank accounts that are subject to our ACH authorization. You must install and use, at your expense, the pre-authorized payment, point of sale, credit card processing, automatic payment, automated banking, electronic debit and/or electronic funds transfer systems that we designate and require in the operation of your Cordova Business. You must pay all service charges and fees charged to you by your bank so that we may electronically debit your bank account.
Source: Item 6 — OTHER FEES (FDD pages 11–15)
What This Means (2025 FDD)
According to Cordova's 2025 Franchise Disclosure Document, franchisees are required to install specific payment systems. Franchisees must install and use, at their own expense, the payment, point of sale, credit card processing, automatic payment, automated banking, electronic debit, and/or electronic funds transfer systems that Cordova designates.
Cordova also requires franchisees to sign an ACH Authorization Form, which allows Cordova to electronically debit the franchisee's designated bank account for all fees payable to them or their affiliates. Franchisees must deposit the gross sales of their Cordova business into designated bank accounts that are subject to Cordova's ACH authorization. Franchisees are also responsible for paying all service charges and fees charged by their bank to allow Cordova to electronically debit their bank account.
This requirement ensures that Cordova can efficiently collect fees and maintain control over the financial transactions within the franchise system. It also ensures a standardized payment processing system across all Cordova locations, which can help with accounting and reporting. Prospective franchisees should factor in the costs associated with installing and maintaining these systems when evaluating the overall investment required to start a Cordova franchise.