When are the initial or renewal fees for a Gold Star franchise due?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
- 8.1.6 The applicable initial or renewal fees set forth in Sections 8.1.1 through 8.1.5 above shall be paid upon execution of this Agreement, is fully earned by the COMPANY upon execution and delivery of this Agreement and is nonrefundable.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the initial franchise fee or renewal fee is due upon the execution of the Franchise Agreement. Once the agreement is executed and delivered, the fee is considered fully earned by Gold Star and is nonrefundable.
Gold Star offers different initial franchise fee amounts based on the franchisee's existing agreements with the company. For franchisees opening a new restaurant with no prior agreements, the initial fee is $50,000. Franchisees with at least one, but fewer than five, existing agreements pay $25,000, while those with five or more agreements pay $10,000. The renewal fee for franchisees entering into the agreement as a renewal of a previous agreement is $5,000.
This means a prospective Gold Star franchisee must be prepared to pay the full initial franchise fee at the time of signing the agreement. This is a standard practice in franchising, as it secures the franchisee's rights and provides Gold Star with capital to begin supporting the new location. The nonrefundable nature of the fee highlights the importance of careful due diligence before signing the agreement.