Can Fat Shack change payment instructions, and if so, what is the condition for doing so?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
- Franchisee agrees that the Royalty, Marketing and Promotion Fee (defined in Section 13.3), Noncompliance Service Charge (defined in Section 12.4), gift card purchases and fees, product purchases, advertising, promotional and point-of-purchase materials, and other payments due to FSI or an affiliate of FSI shall be sent to FSI by electronic funds transfer, unless FSI agrees to another form of payment in its sole discretion.
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, the brand has the authority to modify payment methods at its discretion. Specifically, the franchisee is generally required to make payments via electronic funds transfer. However, Fat Shack retains the sole discretion to agree to another form of payment.
This means that while Fat Shack franchisees are expected to use electronic funds transfer for payments such as royalties, marketing fees, noncompliance charges, gift card transactions, product purchases, and advertising costs, Fat Shack can, if it chooses, allow alternative payment methods.
For a prospective franchisee, this indicates that while electronic funds transfer is the standard, there may be room to negotiate other payment options with Fat Shack. However, the ultimate decision rests solely with Fat Shack.