Can Hck Hot Chicken establish credit terms for franchisees?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
t that the software is not functioning, or this feature is not available, Franchisee shall prepare and submit the required reports manually.
4.6 EFT and Pre-Authorized Payments.
4.6.1 Franchisee, at Franchisee's sole cost and expense, shall instruct its bank to paythe amount of its Continuing Royalty, Brand Fund Contribution and other fees directly to Franchisor from Franchisee's account, by electronic funds transfer or such other automatic payment mechanism which Franchisor may designate ("EFT") and upon the terms and conditions set forth in the HCK Hot Chicken Brand Standards Manual, and promptly upon Franchisor's request, Franchisee shall execute or re-execute and deliver to Franchisor such pre-authorized check forms and other instruments or drafts required by Franchisor's bank, payable against Franchisee's bank account, to enable Franchisor to draw Franchisee's Continuing Royalty, Brand Fund Contributions and other sums payable under the terms of this Agreement. Franchisee must at all times during the term of this Agreement (including any renewal terms) maintain at least one credit card account in good standing and with a minimum available credit line of $10,000.00 and complete the credit card authorization form which allows Franchisor to charge the credit card for any past due amounts owed to Franchisor or an approved supplier in the event an EFT payment is unsuccessful. Franchisor's current form of EFT authorization and credit card authorization is attached to the Franchise Disclosure Document in Exhibit I. Franchisee shall also, in addition to those terms and conditions set forth in the HCK Hot Chicken Brand Standards Manual, maint
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, Hck Hot Chicken does not explicitly state that it will establish credit terms for franchisees. However, the document does state that franchisees must maintain a credit card account in good standing with a minimum credit line of $10,000. This credit card can be charged by Hck Hot Chicken for any past due amounts owed to them or an approved supplier if an electronic funds transfer (EFT) payment is unsuccessful.
Furthermore, franchisees are required to pay continuing royalties, brand fund contributions, and other fees via electronic funds transfer (EFT) or other automatic payment methods designated by Hck Hot Chicken. Franchisees must authorize their bank to make these payments directly to Hck Hot Chicken. The specific terms and conditions for EFT payments are detailed in the Hck Hot Chicken Brand Standards Manual, which franchisees must adhere to.
While Hck Hot Chicken mandates the use of electronic payment methods and requires franchisees to maintain a credit card for backup payments, the FDD does not elaborate on whether Hck Hot Chicken offers any direct credit terms or financing options to franchisees for initial investments or ongoing expenses. A prospective franchisee should inquire directly with Hck Hot Chicken about any potential credit arrangements or financing programs that may be available.