What are Crave Cookies franchisees required to remit to the company based on their monthly revenues?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
As a franchisor, the Company's principal business is to sell franchises and continuing fees to provide managed assistance of those franchises. Franchise rights may be granted through a franchise agreement that sets out the terms of the arrangement with the franchisee. The franchise agreements require that the franchisee remit continuing royalty and marketing fees to the Company based on the monthly revenues of the franchisees. The franchise agreements also require certain, upfront franchise fees such as initial fees paid upon opening of a franchise. The Company recognizes revenue when performance obligations under the terms of contracts with its customers are satisfied, which occurs when pre-opening services are provided to a customer to enable them to direct the use and obtain the benefit of the franchise, with the remaining portion being recognized over the life of the contract.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, franchisees are required to remit continuing royalty and marketing fees to Crave Cookies based on their monthly revenues. These payments are mandated by the franchise agreements that outline the terms of the arrangement between Crave Cookies and its franchisees.
This revenue stream is one of the three main sources from which Crave Cookies derives its income, the others being franchise fees and royalties, service sales, and product sales. The franchise agreements also stipulate certain upfront franchise fees, such as initial fees paid upon the opening of a franchise.
For a prospective Crave Cookies franchisee, this means that a portion of their monthly revenue will be allocated to cover royalty and marketing fees, impacting their overall profitability. Understanding the exact percentage or structure of these fees is crucial for financial planning and assessing the viability of the franchise investment. It is important to carefully review the franchise agreement to fully understand the obligations and revenue-sharing arrangements with Crave Cookies.