What is the initial nonrefundable franchise fee for a standard Jersey Mikes franchise agreement, assuming no Development Agreement is signed?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
Unless you sign a Development Agreement, when you sign a Franchise Agreement, you must pay Company an initial nonrefundable franchise fee of $18,500 for a standard franchise agreement.
In order to offset Company's expenses related to signing a franchise agreement, $5,000 of the Initial Franchise Fee is non-refundable in all circumstances. The individual franchise fees are fully earned and non-refundable under any circumstances except as provided in a. and b. below:
- a. If no acceptable site is found and approved within five months from the date on which the Franchise Agreement is signed, either Company or you may terminate the Franchise Agreement and Company will refund $13,500 of the initial franchise fee to you upon your signing a termination agreement and general release of claims.
- b. If Company determines that you, your Controlling Principal (as defined in Section 15), designated manager or shift supervisors are unable to satisfactorily complete the training program required of all franchisees, Company may terminate the Franchise Agreement and, unless you have signed an Area Development Agreement, Company will return $13,500 of the initial franchise fee to you upon your signing a termination agreement and general release of claims.
If you currently own the majority of at least one other JERSEY MIKE'S franchise, and you apply for a new JERSEY MIKE's franchise without an Area Development Agreement, you will pay Company a reduced initial franchise fee of $8,500, so long as you agree to open your new Franchised Restaurant by December 31, 2026. This reduced initial franchise fee will only apply to a maximum of three new JERSEY MIKE'S franchises that you open. If you do not open your new Franchised Restaurant by December 31, 2026, Company may terminate the Franchise Agreement. You will also sign the Experienced Franchisee Program Addendum, under which Company will waive the real estate and construction fee.
Source: Item 5 — INITIAL FEES (FDD pages 14–15)
What This Means (2025 FDD)
According to Jersey Mikes's 2025 Franchise Disclosure Document, the initial nonrefundable franchise fee for a standard franchise agreement is $18,500, provided that the franchisee does not sign a Development Agreement. This fee is payable when the Franchise Agreement is signed.
For prospective Jersey Mikes franchisees, it's important to note that $5,000 of this initial franchise fee is non-refundable under all circumstances. However, the FDD outlines specific conditions under which the remaining $13,500 may be refundable. If Jersey Mikes or the franchisee terminates the Franchise Agreement because an acceptable site is not found and approved within five months of signing, Jersey Mikes will refund $13,500, provided the franchisee signs a termination agreement and general release of claims. Similarly, if Jersey Mikes determines that the franchisee, their Controlling Principal, designated manager, or shift supervisors cannot satisfactorily complete the required training program, Jersey Mikes will refund $13,500, again contingent on signing a termination agreement and release of claims.
It is also important to note that if a franchisee already owns a majority stake in at least one other Jersey Mike's franchise and applies for a new franchise without an Area Development Agreement, they may qualify for a reduced initial franchise fee of $8,500, provided they open the new restaurant by December 31, 2026. This reduced fee applies to a maximum of three new franchises, and failure to open the restaurant by the specified date may result in termination of the Franchise Agreement. In this scenario, the franchisee will also sign the Experienced Franchisee Program Addendum, which waives the real estate and construction fee.