What obligation does a Multi-Unit Developer have regarding the opening of additional Hyper Kidz Franchised Businesses?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
usiness for business until we have approved you to do so. (Franchise Agreement 4.7)
If you are a Multi-Unit Developer, you must sign your first Franchise Agreement at the same time you sign the Multi-Unit Development Agreement. The typical length of time between the signing of the Franchise Agreement and the opening of your first Franchised Business is the same as for an individual franchisee. Each additional Franchised Business you develop must be opened according to the terms of your minimum performance schedule. (Multi-Unit Development Agreement 3.2)
Grand Opening Advertising Campaign (Franchise Agreement 4.8)
You must spend at least $5,000 to conduct a grand opening advertising campaign to promote the opening of your Hyper Kidz Business. Your grand opening campaign must include the elements we require, such as direct mail campaigns and giveaways. We must approve of your grand opening advertising campaign, and your campaign must be conducted in the period
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, a Multi-Unit Developer must adhere to a minimum performance schedule for opening each additional franchised business. This schedule is part of the Multi-Unit Development Agreement, which the developer signs along with their first Franchise Agreement. The timeline for opening the first franchised business is the same as for an individual franchisee.
Before opening any Hyper Kidz Business, the Multi-Unit Developer must have the site approved by Hyper Kidz, ensuring it meets the franchisor's requirements. The developer is also obligated to spend at least $5,000 on a grand opening advertising campaign, which must include elements required by Hyper Kidz, such as direct mail campaigns and giveaways. This campaign needs approval from Hyper Kidz and must occur within the period of 12 weeks before and 12 weeks after the opening.
Hyper Kidz also provides support to Multi-Unit Developers by reviewing site survey information, providing standard specifications and layouts for the business, and reviewing site plans and build-out plans. This support ensures that each new location aligns with the brand's standards and criteria. Hyper Kidz retains the right to collect grand opening funds and implement advertising activities on behalf of the franchisee.