Can the continuing franchise fees be higher in the renewed Gold Star franchise agreement?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
The terms of such new franchise agreement may differ materially from those in this Agreement, including but not limited to the terms of the franchise agreement, higher continuing franchise fees, higher advertising expenditures, higher fees or charges of other types, a different term,
- different Protected Territory, different renewal rights and other different terms of any kind whatsoever); and
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the terms of the new franchise agreement may differ materially from the original agreement. These differences can include higher continuing franchise fees. This means that when a franchisee renews their Gold Star franchise agreement, they might be required to pay a higher percentage of gross sales as a continuing franchise fee than they did under the original agreement.
This change in fees can significantly impact a franchisee's profitability. It is important for prospective franchisees to carefully review the terms of the renewal agreement and consider how any potential increase in continuing franchise fees will affect their bottom line. Franchisees should factor in these potential changes when projecting future earnings and assessing the overall financial viability of renewing their franchise agreement with Gold Star.
It is also important to note that the new franchise agreement may have other differences, such as higher advertising expenditures, different terms, and different renewal rights. Therefore, franchisees should carefully evaluate all aspects of the renewal agreement before making a decision.