When is the Crave insufficient funds fee due?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
| (1) | (2) | (3) | (4) |
|---|---|---|---|
| Fees (1) | Amount | Due Date | Remarks |
| Interest | 18% per annum or the highest interest rate allowed by applicable law, whichever is greater | On demand | Interest may be charged on all overdue amounts. Interest accrues from the original due date until payment is received in full. |
| Audit Fee | Cost of audit (estimated to be between $1,000 and $5,000) | When billed | Payable only if we find, after an audit, that you have understated Gross Sales by 2% or more or you have understated any amount you owe to us. You must also pay the understated amount plus interest. |
| Insufficient Funds Fee | $100 per occurrence | On demand, if incurred | Payable if there are insufficient funds in your account to pay fees due to us. If you incur three insufficient funds fees in any 12-month period, we have the right to t |
Source: Item 6 — OTHER FEES (FDD pages 12–19)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the insufficient funds fee of $100 is due 'on demand, if incurred.' This means that if a franchisee's account lacks sufficient funds to cover fees owed to Crave, the $100 fee becomes immediately payable.
This fee is a fairly standard practice in franchising and other business relationships. It is designed to cover the administrative costs Crave incurs when a payment is rejected due to insufficient funds. Franchisees should ensure they maintain adequate funds in their designated bank account to avoid this fee.
Notably, the FDD also states that incurring three insufficient funds fees within a 12-month period can lead to the termination of the Franchise Agreement. This highlights the importance of franchisees carefully managing their finances and ensuring timely payments to Crave to maintain good standing and avoid potential penalties.