When is the Cream transfer fee due?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks 1, 2 |
|---|---|---|---|
| Interest on Late Payment | Lesser of 1.5% per month or the highest commercial contract rate allowed by law | As incurred | All amounts which you owe us for any reason will bear interest accruing as of their due dates until payment is received in full. |
| Insufficient Funds Fee | Lesser of $100 or the highest amount permitted by applicable law, per occurrence | As incurred | We will charge you the lesser of our then-current fee, or the highest amount permitted by applicable law, per occurrence, for checks returned to us due to insufficient funds or in the event there are insufficient funds in the business account you designate to cover our withdrawals. |
| Transfer Fee | $25,000 | As incurred, prior to approval of transfer | You must pay this fee as one of the conditions of transferring your Shop and/or your Franchise Agreement and/or Area Development Agreement to another person we approve (other than to a wholly- owned and controlled entity, or if the transfer is from a deceased owner to a surviving spouse, though in such cases you must still reimburse us our processing costs, including legal fees). |
| Relocation Fee | $7,500, plus reimbursement of our costs and fees | As incurred | If you request to relocate your Shop and we approve your request, you must pay a relocation fee. |
| Renewal Fee | $20,000 | As incurred, prior to renewal | You must pay this fee as one of the conditions of obtaining a successor franchise upon the expiration of the Franchise Agreement. |
| Non-Approved | Reimbursement of | As incurred | You must reimburse our costs and expenses if you |
| Product or | our costs and | ask us to evaluate any vendors or products that we | |
| Vendor Testing | expenses | have not approved and we agree to do so. | |
| Insurance | 120% of the premiums paid | As incurred | If you fail or refuse to obtain and maintain the insurance we specify, we may obtain such insurance for you and your Shop on your behalf. |
| Franchise Meeting Fee | To be determined (subject to change) | As incurred | We may designate that attendance at a franchise meeting is mandatory for you and/or your Shopkeeper. We will charge this fee even if you or your Shopkeeper do not attend. This fee will not exceed $1,500 per person. |
| Mystery Shoppers | Reimbursement of our costs and expenses | As incurred | We may engage an independent shopping service to evaluate your Shop. We will determine the frequency, nature, and extent of the evaluation services. You must reimburse all fees and costs charged by the independent shopping service. |
Source: Item 6 — OTHER FEES (FDD pages 13–17)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, the transfer fee of $25,000 is due as incurred, but specifically prior to the approval of the transfer. This means a franchisee looking to sell their Cream shop, Area Development Agreement, and/or Franchise Agreement must be prepared to pay the $25,000 fee before Cream gives the green light to the transfer.
There are a couple of exceptions to this fee. The fee is not required if the transfer is to a wholly-owned and controlled entity or from a deceased owner to a surviving spouse. However, even in these cases, the franchisee must still reimburse Cream for their processing costs, including legal fees. This highlights that while the full $25,000 fee may be waived in specific circumstances, some costs associated with the transfer will still be the responsibility of the franchisee.
This fee structure is fairly standard in the franchise industry, as franchisors typically want to ensure they are compensated for the administrative and legal work involved in approving a transfer. It also allows Cream to maintain control over who becomes a new franchisee, ensuring they meet the brand's standards and qualifications. Prospective franchisees should factor this fee into their financial planning if they anticipate selling their Cream franchise in the future.