Does Del Taco have the right to increase the fees mentioned in Item 6, and if so, what is the condition for doing so?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
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- We have the right to increase this fee upon notice to you. Your annual equipment maintenance and repair costs will vary depending on your specific needs.
| Type of Fee 1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Ceridian Dayforce | $109.75 per month | Fees are payable | Employee workforce |
| $577.50 per year annual | monthly, | management system. The | |
| $2,997.50 one-time | annually and once for the | current fee amount increases | |
| payment for Ceridian clock | Ceridian clock. | periodically based on the consumer price index ("CPI") published by the Bureau of Labor Statistics. These fees are subject to change and we may increase these fees upon notice. | |
| Del U E-Learning | $13.89 per month | Payable after opening in monthly installments with your royalty fee payments | You must participate in our online learning management system, which provides training to all of our Restaurant employees. You must pay us for access to the online learning management system. Upon notice, we may increase the fee to then current fee we charge to new franchisees. Commencing in June 2025, this fee will be paid on an annual basis. |
| Data Services Fee | None currently | Monthly | For restaurant menu management services. |
| Security | None currently | Monthly | Information security infrastructure services to mitigate risks from cyber threats and vulnerabilities. |
| Reporting | None currently | Monthly | Business Intelligence Data and Analytics, integrated sales, services and operational dashboards. |
| Digital Checklist | $50 per month | Monthly | This fee includes the use of the current digital checklist for completing daily food safety checklist. The fee is paid to our approved vendor. The use of digital checklist is a brand standard. |
| Store Audit Reinspection Fee | $500 per reinspection | Payable after a restaurant fails at least two consecutive store audits. The store audit reinspection fee will be assessed for each reinspection following the two consecutive failed audits. | Store audits to assess compliance with operational standards. |
| Type of Fee 1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Marketing | 4% of net sales | Payable monthly by electronic funds transfer by the fifteenth (15th) day of each month, based on the Net Sales for the preceding month | We may increase the fee to the then-current fee we charge new franchisees upon notice to you. The marketing fee for nontraditional locations is typically 1.4% of net sales, but we may modify this fee. |
| Technology Systems Support Services Fee 3 | $173.81 per restaurant per month for your 1st through 5th restaurants; $148.82 per restaurant per month for your 6th through 10th restaurants; $123.84 per restaurant per month for your 11th restaurant and beyond | Payable monthly after opening in advance on the first day of each month (or as we may specify in writing) | You must purchase and maintain the systems we require. See Items 8 and 11. Upon notice, we may increase the fee to the then-current fee we charge new franchisees. |
Source: Item 6 — OTHER FEES (FDD pages 18–21)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, Del Taco has the right to increase certain fees outlined in Item 6. Specifically, Del Taco may increase the Ceridian Dayforce fees, Del U E-Learning fees, the marketing fee, and the Technology Systems Support Services Fee.
For the Ceridian Dayforce fees, the document states that these fees are subject to change and Del Taco may increase these fees upon notice. For the Del U E-Learning fee, Del Taco may increase the fee to the then-current fee they charge to new franchisees, upon notice. The marketing fee may also be increased to the then-current fee Del Taco charges new franchisees, again, upon notice. Similarly, the Technology Systems Support Services Fee can be increased to the then-current fee charged to new franchisees, with prior notice.
Additionally, Del Taco retains the general right to increase fees, as stated in the document: "We have the right to increase this fee upon notice to you." This statement suggests that Del Taco can increase fees beyond those specifically mentioned, provided they give the franchisee notice. This is a fairly standard practice in franchising, allowing the franchisor to adapt to changing market conditions and operational costs, but it does introduce a degree of financial uncertainty for the franchisee. Franchisees should pay close attention to any notices of fee increases and factor potential future increases into their financial planning.
Prospective franchisees should carefully review Item 6 and related sections of the Franchise Agreement to fully understand which fees are subject to change, the conditions under which they may be changed, and the potential impact on their profitability. It would also be prudent to discuss these potential fee increases with existing Del Taco franchisees to gain a better understanding of how these increases have been implemented in practice.