If a franchisee purchases multiple Kidokinetics businesses, how are the fees applied?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
If you purchase multiple Kidokinetics Businesses, the fees indicated in the chart above are the fees charged and/or incurred for each Kidokinetics Businesses except as otherwise noted.
The then-current fee (currently $475 per month with an additional fee of $6 per month if you request additional email addresses)
This fee will cover up to four Kidokinetics Businesses so long as they are operated by the same legal entity and have adjacent territories.
If you purchase multiple franchises at the same time, you will receive an increased Grace Period for your second through fourth franchises as summarized below.
| Franchise Number | Grace Period in Months Following Grace Period | |
|---|---|---|
| Expiration | ||
| 2 | 12 months | |
| 3 | 24 months | |
| 4 | 36 months |
Source: Item 6 — OTHER FEES (FDD pages 13–17)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, franchisees purchasing multiple Kidokinetics businesses will generally incur the standard fees for each business, although there are some exceptions. The document states that 'if you purchase multiple Kidokinetics Businesses, the fees indicated in the chart above are the fees charged and/or incurred for each Kidokinetics Businesses except as otherwise noted.' This means franchisees should anticipate paying the listed fees for each location they own.
One notable exception to this rule is the Technology Fee. The FDD specifies that the monthly Technology Fee (currently $475, plus $6 per additional email address) covers up to four Kidokinetics businesses, provided they are operated by the same legal entity and have adjacent territories. This could represent a significant cost saving for franchisees who operate multiple locations within a single legal structure and geographic area, as they would not need to pay the full technology fee for each individual franchise.
In addition to the standard fees, franchisees who purchase multiple Kidokinetics franchises at the same time receive an extended 'Grace Period' before they are required to begin paying Minimum Royalties for their second through fourth franchises. The grace periods are as follows: 12 months following the grace period expiration for the second franchise, 24 months for the third franchise, and 36 months for the fourth franchise. This staggered approach to minimum royalty payments can help franchisees manage their cash flow during the initial ramp-up phase of multiple businesses.
It is important to note that all fees are subject to change, including potential increases based on the Consumer Price Index (CPI). Any fee increases based on CPI will be announced at least 60 days in advance, and Kidokinetics will implement no more than one CPI-related fee adjustment per calendar year. Prospective franchisees should carefully review the fee structure and grace period details in the Franchise Disclosure Document and discuss any questions or concerns with the franchisor before investing in multiple Kidokinetics businesses.