What is the definition of 'Minimum Performance Standards' for an Engineering For Kids franchise?
Engineering_For_Kids Franchise · 2025 FDDAnswer from 2025 FDD Document
of the rights specified above inside your Territory.
Minimum Performance Standards
The rights to operate under the Franchise Agreement, including the territorial rights described above, are conditioned upon your complying with the Franchise Agreement, including that your Franchised Business must generate a minimum level of Gross Sales on an annual basis for each Operating Year, in the amounts described in the Franchise Agreement (the "Minimum Performance Standards"). For this purpose, the first Operating Year will begin on the first day of the Period for which you must submit your first Royalty payment and Sales Report, and will
continue until the one-year anniversary (of the date when that Operating Year started). The current Minimum Performance Standards are:
| Operating Year* | Minimum Annual Gross Sales at the End of Operating Year* |
|---|
Source: Item 12 — TERRITORY (FDD pages 36–41)
What This Means (2025 FDD)
According to the 2025 Engineering For Kids FDD, the 'Minimum Performance Standards' are defined as the minimum level of Gross Sales a franchised business must generate on an annual basis for each Operating Year, as detailed in the Franchise Agreement. The first Operating Year begins on the first day of the period for which the franchisee must submit their first Royalty payment and Sales Report, continuing until the one-year anniversary of that date.
The FDD specifies the current Minimum Performance Standards. For Year 1, there is no minimum Gross Sales requirement. In Year 2, the minimum annual Gross Sales must be $50,000. By Year 3, this increases to $75,000.
It is important to note that the rights to operate under the Franchise Agreement, including the described territorial rights, are conditional upon compliance with the Franchise Agreement, including meeting these Minimum Performance Standards. Failure to meet these standards and cure any deficiencies could result in actions such as reducing the territory size, allowing other franchisees to operate within the territory, or establishing additional Engineering For Kids businesses in the territory.