Besides the Royalty Fee, what other fee does Ella Cafe reserve the right to impose?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
| EFFECTIVE DATE: | |||
|---|---|---|---|
| FRANCHISEE: | |||
| INFORMATION FOR NOTICES: | |||
| Address: | |||
| Telephone Number: | |||
| Email Address: | |||
| PRINCIPAL EXECUTIVE: | |||
| Address: | |||
| Telephone Number: | |||
| Email Address: | |||
| SITE SELECTION AREA | Ella Coffee House of | ||
| NAME: | |||
| INITIAL FRANCHISE FEE: | $49,500. | ||
| MARKET INTRODUCTION | Minimum of $5,000. | ||
| PROGRAM: | |||
| ROYALTY FEE: | 7% of your Gross Sales. |
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, besides the Royalty Fee, Ella Cafe also reserves the right to impose a Brand Marketing Fee.
The table in Item 22 specifies that the Royalty Fee is 7% of gross sales. In addition to this, Ella Cafe can charge a Brand Marketing Fee of up to 3% of gross sales. This fee is separate from local advertising, which Ella Cafe also specifies can be up to 3% of gross sales.
As a prospective franchisee, it is important to understand that these fees can significantly impact your profitability. While the Brand Marketing Fee is 'up to' 3%, it is within Ella Cafe's right to charge this full amount. Therefore, you should factor in the maximum potential fees when evaluating the financial feasibility of the franchise.