What are the criteria that Hyper Kidz uses to approve a lease or purchase agreement?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
Before you open your Hyper Kidz Business, we will:
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- Approve a lease or purchase agreement for the approved site, if the lease or purchase agreement meets our criteria. We may also assist you in negotiating the lease or purchase agreement. If we do not notify you of our approval or disapproval a proposed lease or purchase agreement within 15 days, it shall be deemed approved. At our request, you must have your landlord sign a Collateral Assignment of Lease. (Franchise Agreement – Section 4.2. and Attachment 6)
You must select the site for your Hyper Kidz Business, and you must obtain our written acceptance of any proposed site in accordance with our procedures. Within 180 days after you sign the Franchise Agreement, you must submit to us the information and materials we may reasonably require for your proposed site, including demographic, commercial and other information, and photographs. We will consider the site based on demographic characteristics of the proposed site, traffic patterns, parking, the predominant character of the neighborhood, competition from other businesses providing similar services within the area (including other Hyper Kidz Businesses), the number of households, income levels, population, the purchase price or lease terms for the proposed site and other commercial characteristics, the size of the premises, appearance, and other physical characteristics of the proposed site. (Franchise Agreement – 4.1)
We will have 30 days after we receive this information and materials from you to approve or disapprove the proposed site as the location for your Hyper Kidz Business. If we do not provide our specific approval of a proposed site, the site is deemed not approved. Our approval only means that the site meets our requirements for a Hyper Kidz Business. We also reserve the right to approve your lease. We will not lease a site and then sublease it to you. (Franchise Agreement 4.1.2)
If you do not locate a suitable site within 180 days after you sign the Franchise Agreement, we will provide you with an additional 30 days to locate a suitable site. If you do not locate a suitable site within this additional 30-day period, we may provide you with an additional extension, in our discretion, or we may terminate the Franchise Agreement. (Franchise Agreement 4.1.2)
We estimate that the time from when the Franchise Agreement is signed to the opening of the Hyper Kidz Business will be approximately 9 to 12 months. This time may be shorter or longer depending on the time necessary to obtain an accepted site, to obtain financing, to obtain the permits and licenses for the construction and operation of the Hyper Kidz Business, to complete construction or remodeling as it may be affected by weather conditions, shortages, delivery schedules and other similar factors, to complete the interior and exterior of the Hyper Kidz Business, including decorating, purchasing and installing fixtures, equipment and signs, and to complete preparation for operating the Hyper Kidz Business, including
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 24–33)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, before a franchisee can open their Hyper Kidz Business, Hyper Kidz must approve a lease or purchase agreement for the approved site, provided the agreement meets their criteria. If Hyper Kidz does not notify the franchisee of their approval or disapproval of a proposed lease or purchase agreement within 15 days, it is deemed approved. Hyper Kidz may also assist in negotiating the lease or purchase agreement. At Hyper Kidz's request, the franchisee must have their landlord sign a Collateral Assignment of Lease.
Hyper Kidz also has specific site selection criteria. Within 180 days after signing the Franchise Agreement, the franchisee must submit all required information and materials for their proposed site. Hyper Kidz will then consider various factors, including demographic characteristics, traffic patterns, parking, the neighborhood's character, competition from similar businesses (including other Hyper Kidz locations), the number of households, income levels, and population. They also assess the purchase price or lease terms, the size of the premises, its appearance, and other physical characteristics.
Hyper Kidz has 30 days to approve or disapprove the proposed site after receiving the necessary information. Failure to provide specific approval within this period means the site is not approved. However, Hyper Kidz's approval only indicates that the site meets their requirements for a Hyper Kidz Business. The brand also reserves the right to approve the lease itself but will not lease a site and then sublease it to the franchisee.
If a franchisee fails to find a suitable site within the initial 180-day period, Hyper Kidz will grant an additional 30 days. If a site is still not located within this extension, Hyper Kidz may, at its discretion, offer a further extension or terminate the Franchise Agreement. The estimated time from signing the Franchise Agreement to opening the Hyper Kidz Business is approximately 9 to 12 months, though this can vary based on factors such as site selection, financing, permits, construction, and preparation for operations.