Is the Development Fee for a Corner Bakery Cafe refundable, and if not, why?
Corner_Bakery_Cafe Franchise · 2025 FDDAnswer from 2025 FDD Document
refundable for any reason.
Development Fee
When you sign the Development Agreement, you will pay a development fee in the amount of $20,000 for each Franchised Cafe that you agree to develop (the "Development Fee"). The Development Fee is fully earned by us when paid by you, and it is not refundable in consideration of administrative and other expenses incurred by us and for the development opportunities lost or deferred as a result of the rights granted to you in the Development Agreement. In addition, the Development Fee is not credited against any other fees that you will pay to us. You must agree to develop at least two
Source: Item 5 — INITIAL FEES (FDD page 11)
What This Means (2025 FDD)
According to the 2025 Corner Bakery Cafe Franchise Disclosure Document, the Development Fee is generally not refundable. When signing a Development Agreement, a franchisee must pay $20,000 as a development fee for each Corner Bakery Cafe they agree to develop. This fee is considered fully earned by Corner Bakery Cafe upon payment.
The FDD states that the Development Fee is non-refundable because Corner Bakery Cafe incurs administrative and other expenses and loses or defers other development opportunities as a result of granting the developer the rights outlined in the Development Agreement. The Development Fee is also not credited towards any other fees the franchisee will eventually pay to Corner Bakery Cafe.
It is important to note that while Corner Bakery Cafe generally imposes these fees uniformly, there may be unique circumstances where they reduce or waive a fee for a particular franchisee. However, the standard policy is that the Development Fee is non-refundable to offset Corner Bakery Cafe's expenses and lost opportunities.