How is the Development Fee calculated for a Crisp & Green Area Development Agreement?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
Development Fee**
We offer qualified candidates the right to develop multiple (three or more) Franchised Restaurants under an Area Development Agreement. The development fee you pay when you sign an Area Development Agreement will vary depending on the number of Franchised Restaurants you commit to open. If you are approved and choose to enter into an Area Development Agreement, you must pay a development fee ("Development Fee") equal to $54,900 multiplied by the number of Franchised Restaurants you agree to open under our form of Area Development Agreement. You will not pay an additional initial franchise fee for any of the Franchised Restaurants you are required to develop under the Area Development Agreement. All portions of the Development Fee are payable in full when you sign the Area Development Agreement and are considered fully earned and nonrefundable upon payment. We intend for the Development Fee to be uniform for all franchisees. As we began offering Area Development Agreements as of the date of this disclosure document, we did not collect any Development Fees in our
Source: Item 5 — INITIAL FEES (FDD pages 14–15)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, the Development Fee for an Area Development Agreement is calculated by multiplying $54,900 by the number of franchise restaurants the franchisee commits to opening under the agreement. This fee is paid in full when the Area Development Agreement is signed.
This Development Fee is nonrefundable and considered fully earned by Crisp & Green upon payment. The document specifies that the franchisee will not pay an additional initial franchise fee for any of the restaurants they are required to develop under the Area Development Agreement. This is a common practice in franchising, where the development fee secures the rights to a larger territory, and the initial franchise fees are often waived for each individual unit opened within that territory.
It is important to note that while Crisp & Green intends for the Development Fee to be uniform for all franchisees, they had not collected any Development Fees in their last fiscal year, as they had just begun offering Area Development Agreements as of the date of the disclosure document. Prospective franchisees should confirm the current Development Fee and any potential variations with Crisp & Green.