What costs are included in 'our costs' that Endless Summer Sweets charges if they cure my non-compliance?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Our out-of-pocket | When billed | We may cure your non-compliance on | |
| costs and internal | your behalf (for example, if you do not | ||
| cost allocation, plus | have required insurance, we may purchase | ||
| 10% | insurance for you), and you will owe our | ||
| costs plus a 10% administrative fee. |
Source: Item 7 — Estimated Initial Investment (FDD pages 10–14)
What This Means (2024 FDD)
According to the 2024 Endless Summer Sweets Franchise Disclosure Document, if a franchisee fails to maintain required insurance coverage, Endless Summer Sweets has the option to purchase the insurance on the franchisee's behalf to cure the non-compliance. If Endless Summer Sweets takes this action, the franchisee will be responsible for reimbursing Endless Summer Sweets for their out-of-pocket costs and an internal cost allocation, plus an additional 10% administrative fee.
This means that in addition to the direct expenses Endless Summer Sweets incurs to rectify the franchisee's non-compliance, such as the insurance premium, the franchisee will also be charged for Endless Summer Sweets' internal resources used to handle the issue. The 10% administrative fee is applied on top of these costs.
This policy ensures that Endless Summer Sweets can maintain brand standards and operational compliance across all franchise locations, while also protecting themselves from potential liabilities arising from a franchisee's failure to meet contractual obligations. Franchisees should ensure they understand and comply with all requirements outlined in the franchise agreement to avoid incurring these additional costs and fees.