What costs are Expense Reduction Analysts franchisees responsible for if a collection agency is used?
Expense_Reduction_Analysts Franchise · 2025 FDDAnswer from 2025 FDD Document
| NAME OF FEE1 | AMOUNT OR FORMULA | DUE DATE | REMARKS |
|---|---|---|---|
| Costs of collection | 5% of all costs of collection, including reasonable attorney's fees and interest. | When incurred | If a collection agency is used, you must reimburse us for our attorneys' fees and other costs that we incur in connection any dispute involving amounts owed |
Source: Item 6 — OTHER FEES (FDD pages 13–19)
What This Means (2025 FDD)
According to Expense Reduction Analysts' 2025 Franchise Disclosure Document, if a collection agency is used to recover owed amounts, franchisees are responsible for specific costs. In addition to a 5% charge on all collection costs, which includes reasonable attorney's fees and interest, the franchisee must also reimburse Expense Reduction Analysts for their attorneys' fees and other costs incurred in connection with any dispute involving the owed amounts.
This means that if Expense Reduction Analysts has to engage a collection agency due to a franchisee's failure to pay what is owed, the franchisee will face multiple layers of expenses. These include not only the collection agency's fees but also a 5% surcharge on those fees, plus Expense Reduction Analysts' internal legal costs associated with the collection process.
For a prospective Expense Reduction Analysts franchisee, this highlights the importance of maintaining good financial standing and adhering to the payment terms outlined in the franchise agreement. Failure to do so can result in significant additional costs beyond the original debt, potentially impacting the profitability and financial stability of the franchise.