What is the Prospect Generation Fee for a Deka Lash franchise, and how is the amount determined?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
| Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Prospect | The actual cost | Prior to us giving | In the event you decide to sell |
| Generation | incurred by us, including commissions and fees charged by business brokers in cases where the buyer is identified through such broker. | consent to transfer your operating studio. | your operating studio to a prospective franchisee that comes from a lead generated through us (including broker networks, consultants, and referral sources used by us) you will be required to pay us a Prospect Generation Fee to reimburse us for our associated expenses before we will consent to the transfer of the operating studio to such a buyer. This fee is in addition to the Transfer Fee. |
| Fee |
Source: Item 6 — OTHER FEES (FDD pages 15–23)
What This Means (2024 FDD)
According to Deka Lash's 2024 Franchise Disclosure Document, the Prospect Generation Fee is incurred when a franchisee decides to sell their operating studio to a prospective franchisee that was initially a lead generated by Deka Lash. This fee is designed to reimburse Deka Lash for the expenses they incurred in generating that lead, including commissions and fees paid to business brokers if the buyer was identified through such a broker.
The Prospect Generation Fee is equal to the actual cost incurred by Deka Lash to generate the lead. This means the fee can vary depending on the source of the lead and the associated costs, such as broker fees or advertising expenses. The franchisee is required to pay this fee before Deka Lash will consent to the transfer of the operating studio to the buyer.
It's important to note that the Prospect Generation Fee is in addition to the standard Transfer Fee, which covers the administrative costs and approvals associated with transferring the franchise to a new owner. This fee structure ensures that Deka Lash is compensated for their efforts in finding a suitable buyer for an existing franchise, while also allowing the franchisee to sell their business.
For a prospective Deka Lash franchisee, this means that if they decide to sell their franchise in the future and the buyer is someone who was originally a lead generated by Deka Lash, they will be responsible for paying the Prospect Generation Fee. It would be wise to inquire with Deka Lash about the typical range of these fees to better understand the potential costs associated with selling the franchise.