How is the Operating Fee calculated for a Gold Star franchise?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Operating Fee11 | 125% of Gold Star, or its designees, cost of operation | Same as Continuing Franchise Fee | Payable to Gold Star or its designated operator Non-refundable |
Source: Item 6 — OTHER FEES (FDD pages 12–18)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the Operating Fee is calculated as 125% of Gold Star's, or its designees, cost of operation. This fee is charged when Gold Star believes it is necessary to step in and manage the restaurant operations to ensure compliance with the brand's standards.
This fee is due at the same time as the Continuing Franchise Fee, indicating it's an ongoing charge while Gold Star is managing the operations. It is payable to Gold Star or its designated operator and is non-refundable.
For a prospective franchisee, this means that if the restaurant fails to meet operational standards, Gold Star has the right to take over operations, and the franchisee will be responsible for paying 125% of the costs incurred by Gold Star or its designee to run the restaurant. This could significantly impact profitability and cash flow during the period of operational deficiency.