What is the maximum investment Jersey Mikes can require a franchisee to make for equipment, supplies, remodeling, or upgrades during the term of the Franchise Agreement?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
greements comply with and are enforceable under applicable laws.
9. MODIFICATION OF THE SYSTEM
Franchisor reserves the right to change or modify the System in its sole and absolute discretion by adopting and using new or modified System Standards, trade names, trademarks, service marks, copyrighted materials, or specifications or standards for menu items, products, services, building design, equipment or new techniques and Franchisee shall accept, adopt and make any such mandatory changes at the Restaurant, as if they were part of this Agreement at the time of its execution. Franchisee will make such expenditures as such changes or modifications in the System as Franchisor may reasonably require, utilizing a Franchisor-approved licensed contractor, provided the cost of capital improvements, new equipment and remodeling does not exceed One Hundred Fifty Thousand Dollars ($150,000.00) during the term of this Agreement, and the cost of updates and upgrades of Franchisee's point-of-sale system ("POS System") does not exceed Fifty Thousand Dollars ($50,000) du
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD pages 56–57)
What This Means (2025 FDD)
According to Jersey Mikes's 2025 Franchise Disclosure Document, there are limits to how much a franchisee can be required to spend on changes or modifications to the system during the term of the agreement. Jersey Mikes reserves the right to change or modify the system, including adopting new standards, trade names, trademarks, service marks, copyrighted materials, specifications for menu items, products, services, building design, or equipment.
During the franchise agreement, franchisees must accept and adopt these mandatory changes at their restaurant. The maximum expenditure for capital improvements, new equipment, and remodeling is $150,000.00. Additionally, there is a separate limit of $50,000.00 for updates and upgrades to the franchisee's point-of-sale (POS) system.
These limits provide some financial predictability for franchisees, capping the amount they can be forced to invest in upgrades and changes to maintain brand standards and system consistency. However, franchisees should still carefully consider the potential costs of these required updates when evaluating the overall financial commitment of the franchise.