To what extent are transfer fees collectable from a Craters & Freighters franchisee in Washington?

According to the 2025 Craters & Freighters Franchise Disclosure Document, transfer fees are collectable from a franchisee in Washington only to the extent that they reflect Craters & Freighters' reasonable estimated or actual costs in facilitating the transfer. This means that Craters & Freighters cannot charge an arbitrary or inflated transfer fee; the fee must be tied to the actual expenses they incur during the transfer process.

For a prospective Craters & Freighters franchisee in Washington, this provides some protection against excessive transfer fees. If a franchisee decides to sell their business, the transfer fee charged by Craters & Freighters must be justifiable based on real costs. This could include legal fees, administrative expenses, training costs for the new franchisee, and other related expenses.

It is important for a potential Craters & Freighters franchisee to understand what constitutes "reasonable estimated or actual costs." They should ask Craters & Freighters for a detailed breakdown of potential transfer-related expenses to ensure transparency. This clause in the FDD aims to prevent franchisors from profiting unduly from franchise transfers, aligning with the Washington Franchise Investment Protection Act's intent to protect franchisees.