When is the initial franchise fee considered fully earned by Crepe De Licious?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
eement, so long as you are not in default under this Agreement. We may require you to use the intranet system for communications, reports, and other functions, and you will comply with our requirements.
8. PAYMENTS AND REPORTS
8.01 Initial Franchise Fee. When you sign this Agreement, you will pay us the initial franchise fee ("Initial Franchise Fee") in the amount of $35,000. The Initial Franchise Fee is in consideration of the administrative and other expenses we incurred in entering into this Agreement, and for our lost or deferred opportunity to enter into a similar arrangement with others. The Initial Franchise Fee is non-refundable, and is fully earned when we sign this Agreement. Notwithstanding the foregoing, the Initial Franchise Fee is not payable hereunder if you sign an area develo
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, the initial franchise fee of $35,000 is considered fully earned by Crepe De Licious when the franchise agreement is signed by both parties. This fee compensates Crepe De Licious for the administrative and other expenses incurred in entering into the agreement, as well as for the lost or deferred opportunity to enter into a similar arrangement with another franchisee.
It is important to note that the initial franchise fee is non-refundable. However, the FDD states that the initial franchise fee is not payable if the franchisee signs an area development agreement governing the territory, unless that agreement requires payment of the initial franchise fee. Additionally, the initial franchise fee will be reduced by any territory reservation fee previously paid to Crepe De Licious.
This arrangement is fairly standard in the franchise industry, where initial fees are typically non-refundable and cover the franchisor's initial costs and lost opportunities. Prospective franchisees should carefully consider these terms before signing the franchise agreement, as the $35,000 fee is earned by Crepe De Licious upon signing and will not be returned, even if the franchisee does not ultimately open a Crepe De Licious location.