Does the Deka Lash Franchise Agreement allow for deferral of initial fees?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
HAWAII ADDENDUM TO THE FRANCHISE AGREEMENT
If any of the terms of the Franchise Agreement are inconsistent with the terms below, the terms below control
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- Initial Fee Deferral. The Franchise Agreement is modified to also provide that we defer the payment of all initial fees paid by you to us until we have performed all pre-opening obligations and you are open for business.
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
According to the 2024 Deka Lash Franchise Disclosure Document, the standard Franchise Agreement does not appear to offer initial fee deferral, but there is an exception for franchisees in Hawaii. The Hawaii Addendum to the Franchise Agreement specifically modifies the standard agreement to allow for the deferral of all initial fees until Deka Lash has fulfilled all pre-opening obligations and the franchisee is open for business.
This deferral could significantly benefit prospective Deka Lash franchisees in Hawaii by reducing their upfront financial burden. Instead of paying the initial franchise fee before opening, they can delay payment until the studio is ready to operate. This can help with cash flow management during the initial setup phase of the business.
It is important to note that this deferral is only applicable in Hawaii. Franchisees in other states are likely required to pay the initial franchise fee upfront according to the standard terms of the Franchise Agreement. Prospective franchisees should carefully review the specific terms of their Franchise Agreement and any applicable addenda to understand the fee payment schedule and obligations.