What are the consequences of failing to submit a required report for a Hck Hot Chicken franchise?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (Note 1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Failure to Submit Required Report Fee | $100 per occurrence and $100 per week | Your bank account will be debited for failure to submit any requested report within five days of request | Payable if you fail to submit any required report or financial statement when due. Fines collected are paid to the Brand Fund. You will continue to incur this fee until you submit the required report. |
| Audit Expenses | Cost of audit and inspection, any understated amounts, plus Interest, and any related accounting and legal expenses | On demand | You will be required to pay this if an audit reveals that you understated your weekly Gross Sales by more than 2% or you fail to submit required reports. |
Source: Item 6 — OTHER FEES (FDD pages 13–19)
What This Means (2025 FDD)
According to Hck Hot Chicken's 2025 Franchise Disclosure Document, failing to submit a required report can result in significant financial penalties. Specifically, Hck Hot Chicken franchisees will be charged $100 per occurrence and an additional $100 per week for each week the report is late. This "Failure to Submit Required Report Fee" continues to accrue until the franchisee submits the required report. These fines are directed to the Brand Fund.
Furthermore, the FDD states that Hck Hot Chicken will debit the franchisee's bank account if the report is not submitted within five days of the request. This highlights the importance of adhering to the reporting schedule and ensuring timely submission of all required documents to avoid these recurring fees. Franchisees should establish robust internal processes to manage and track report submissions to prevent oversights.
In addition to the specific 'Failure to Submit Required Report Fee,' Hck Hot Chicken may also conduct an audit if a franchisee fails to submit required reports. If this audit reveals that the franchisee understated their weekly Gross Sales by more than 2%, the franchisee will be responsible for covering the cost of the audit and inspection, any understated amounts, plus interest, and any related accounting and legal expenses. This underscores the importance of accurate financial reporting and the potential for more extensive and costly consequences beyond the initial late fee.