What is the Initial Franchise Fee for the second Kidokinetics franchise purchased under a Multi-Franchise agreement?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
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We may also allow franchisees, in our discretion, to purchase multiple franchises (up to four) ("Multi-Franchise"). If you purchase a Multi-Franchise, you will enter into separate Franchise Agreements for each Franchise and pay a reduced Initial Franchise Fee for the additional Franchises: (a) $60,000 for the first Franchise Agreement; (b) $40,000 for the second Franchise Agreement; and (c) $35,000 under the third and fourth Franchise Agree
Source: Item 5 — INITIAL FEES (FDD pages 11–13)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, the initial franchise fee for the second franchise purchased under a Multi-Franchise agreement is $40,000. This fee is part of a tiered structure where the initial fee decreases with each additional franchise purchased, up to a maximum of four franchises. The initial franchise fee is paid in a lump sum when the franchisee signs the Franchise Agreement and is non-refundable.
This reduced fee for additional franchises is a common incentive offered by franchisors to encourage multi-unit ownership. It recognizes that the franchisor's costs associated with adding subsequent locations for an existing franchisee are typically lower than those for onboarding a completely new franchisee. The initial franchise fee covers Kidokinetics's expenses related to providing assistance and services, including sales and marketing, training, and legal and accounting fees.
For prospective Kidokinetics franchisees considering a multi-franchise agreement, this tiered fee structure can significantly reduce the overall investment required. However, franchisees should carefully consider their ability to manage multiple locations effectively and meet the operational and financial demands of each franchise. It's also important to note that while the initial franchise fee is reduced for additional franchises, other fees, such as the Initial Marketing Package and Software License Fee, are still applicable for each additional Kidokinetics Business opened.
Veterans may also be eligible for a 5% discount on the initial franchise fee for each Kidokinetics franchise they purchase. To receive this discount, veterans must provide a copy of their DD214. Franchisees should also be aware that some states may have imposed a financial assurance, and they should refer to the State Addendum in Exhibit G of the Franchise Disclosure Document for more information.