What transfer fee does Crave Cookies Franchising receive upon transfer of the franchise?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
all amounts owed to Crave Cookies Franchising.
ARTICLE 15. TRANSFERS
- 15.1 By Crave Cookies Franchising. Crave Cookies Franchising may transfer or assign this Agreement, or any of its rights or obligations under this Agreement, to any person or entity, and Crave Cookies Franchising may undergo a change in ownership and/or control, without the consent of Franchisee.
- 15.2 By Franchisee. Franchisee acknowledges that the rights and duties set forth in this Agreement are personal to Franchisee and that Crave Cookies Franchising entered into this Agreement in reliance on Franchisee's business skill, financial capacity, personal character, experience, and business ability. Franchise Fees are not refundable, as stated in Section 4.1 of this agreement. Franchisee may not transfer an undeveloped territory. Crave Cookies Franchising may reject any proposed transfer for any reason it sees fit. Accordingly, Franchisee shall neither conduct nor undergo a Transfer without providing Crave Cookies Franchising at least 60 days prior notice of the proposed Transfer, and without obtaining Crave Cookies Franchising's consent. In granting any such consent, Crave Cookies Franchising may impose conditions, including but not limited to the following:
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, if a franchisee seeks to transfer their franchise to a new owner, Crave Cookies Franchising will collect a transfer fee. This fee is $10,000, in addition to any broker fees, legal fees, and other out-of-pocket costs that Crave Cookies incurs during the transfer process. However, the FDD stipulates that the $10,000 transfer fee does not apply to franchise transfers in the state of Washington; in Washington, Crave Cookies Franchising, LLC is still entitled to broker fees and other out-of-pocket costs it incurs.
This transfer fee is one of several conditions Crave Cookies may impose when granting consent for a transfer. Other conditions include ensuring the proposed new franchisee meets Crave Cookies' standards, is not a competitor, and executes the then-current franchise agreement. The franchisee must also have met all their financial obligations to Crave Cookies and its affiliates.
For a prospective Crave Cookies franchisee, this means that selling their franchise in the future will incur a significant fee, potentially reducing the profit from the sale. It is important to factor in these costs when considering the long-term financial implications of owning a Crave Cookies franchise. Additionally, the franchisor's right to approve or reject any transfer adds a layer of uncertainty to the process.