What is the required action for a Crave Cookies franchisee after a third infraction of creating unapproved discounts and promotions?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
ill escalate according to the severity tier.
- a. First Offense: Verbal warning or a formal written warning, documented in the franchisee's file.
b. Second Offense:
- i. Mild Infraction: Official warning and mandatory review meeting.
- ii. Moderate Infraction: Fine or suspension of certain privileges; mandatory training (online, virtual, or in-person) may be required.
- iii. Severe Infraction: Immediate fine and mandatory mee
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, the consequences for a third offense related to creating unapproved discounts and promotions depend on the severity of the infraction. For a mild infraction, the franchisee will face a fine of $100 and must submit a comprehensive improvement plan. If the infraction is moderate, the franchisee will be fined $1,000, undergo a follow-up audit within 30 days, and also provide a detailed improvement plan. Additionally, if the franchisee is maintaining a 4.5-star rating, they must hire a reputation management and improvement company. In the case of a severe infraction, the franchisee will be fined $5,000, and Crave Cookies will consider terminating the franchise agreement.
These escalating penalties highlight the importance Crave Cookies places on adhering to approved promotional strategies. The fines increase significantly with the severity of the infraction, and repeated severe violations can lead to the termination of the franchise agreement. The requirement to hire a reputation management company for franchisees maintaining a 4.5-star rating after a moderate infraction suggests that Crave Cookies is particularly concerned about protecting its brand image and customer perception, even when a franchisee is generally performing well.
Prospective franchisees should understand that non-compliance with marketing and promotional guidelines can result in substantial financial penalties and potential termination of their franchise agreement. It is crucial to adhere to the approved marketing strategies and seek clarification from Crave Cookies Franchising, LLC if there are any uncertainties. Understanding the specific criteria that define mild, moderate, and severe infractions related to unapproved discounts and promotions is also essential for franchisees to avoid unintentional violations and maintain a positive relationship with the franchisor.