How does Deka Lash collect the development fee for Area Development Agreements in Hawaii?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
HAWAII ADDENDUM TO THE AREA DEVELOPMENT AGREEMENT
If any of the terms of the Area Development Agreement are inconsistent with the terms below, the terms below control.
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- Initial Fee Deferral. The Area Development Agreement is modified to also provide that we will collect the development fee on a pro-rated basis as each outlet is opened under the development agreement.
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
According to the 2024 Deka Lash Franchise Disclosure Document, for Area Development Agreements in Hawaii, Deka Lash collects the development fee on a pro-rated basis as each outlet is opened under the development agreement.
This means that instead of paying the entire development fee upfront, the franchisee pays a portion of the fee as each new Deka Lash studio opens within their designated area. This arrangement can significantly reduce the initial financial burden on the franchisee, making it easier to manage cash flow during the early stages of development.
This pro-rated payment plan is specific to Hawaii, as indicated by the Hawaii addendum to the Area Development Agreement. Prospective franchisees in Hawaii should carefully review this addendum to fully understand the terms and conditions related to the development fee payment schedule. This could be a beneficial arrangement for franchisees in Hawaii, as it aligns the payment of fees with the actual opening of new studios, potentially reducing financial risk.