When are late payment penalties due for a Creative World School franchise?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
| Name of Fee(1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Transfer | Greater of $20,000 or 25% of then- current initial franchise fee | Upon signing transfer franchise agreement | N/A |
| Transferee | Training, cost to be included in | As incurred | You pay all travel and living |
| Training | Transfer fee | expenses. | |
| Renewal | Greater of $20,000 or 25% of then- current initial franchise fee | Upon signing successor franchise agreement | N/A |
| Audit | Cost of inspection or audit plus travel | 10 days after billing | Payable only if you fail to furnish reports, supporting records or other required information. |
| Interest | Lesser of 18 % per year or highest contract rate of interest allowed by law | 15 days after billing | Payable on all overdue amounts. |
| Late Payment Penalties | 5% of the late amount | Due on payment of late amount | Payable on all late payments including interest. |
Source: Item 6 — OTHER FEES (FDD pages 15–18)
What This Means (2025 FDD)
According to the 2025 Creative World School Franchise Disclosure Document, late payment penalties are due when the late amount is paid. The penalty is 5% of the late amount. This applies to all late payments, including interest.
This means that if a Creative World School franchisee is late on any payment to the franchisor, they will incur a penalty of 5% of the overdue amount. This penalty becomes due at the time the franchisee finally makes the late payment. It's important to note that this penalty applies not only to the principal amount that is late but also to any accrued interest on that late amount.
Most franchise agreements include late payment penalties to encourage timely payments. The specific percentage can vary, but 5% is a fairly standard penalty. Franchisees should ensure they have systems in place to manage payments and avoid late fees, as these can add up quickly and impact profitability. Understanding the due dates for all fees and setting reminders can help prevent incurring these penalties.