How does Pearce Bespoke calculate the initial franchise fee?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
FEES**
Franchise Agreement
When you sign your Franchise Agreement, you must pay to us the initial franchise fee ("Franchise Fee") of $55,900, for a Franchised Territory with a population of between 50,000 to 200,000 people or $29,000 for a Franchised Territory with a population of no more than 50,000 people. The Franchise Fee is due upon the signing of our Franchise Agreement and is considered fully earned by Pearce Bespoke upon payment. The Franchise Fee includes your license to operate the Franchise. This Franchise Fee is not refundable, in whole or in part, under any circumstances. The initial Franchise Fee is calculated and applied uniformly to all our franchisees. The method we use to calculate the Franchise Fee is uniform for all franchises that we offer through this Disclosure Document.
Development Agreement
Pearce Bespoke If we determine that you are financially and operationally qualified to develop multiple Franchises, we may offer you the opportunity to enter into a Development Agreement, in which you will commit to develop a certain number of Franchises that we determine to be appropriate. We have the right to determine the number of Franchises that we deem as appropriate in our sole and absolute discretion, based upon several factors, such as but not limited to, territory availability, your business acumen, your financial wherewithal, your ability to fund or obtain funding for your Franchise, and your overall business and operational experience. If you enter into a Development Agreement, you must pay us a one- time development fee
2025 FDD 9
upon execution of your Development Agreement ("Development Fee"). Your Development Fee will depend on the number of Franchises we grant you the right to open within the Development Area, and is calculated as set forth in the table below:
| Number of | | | |---|---|---| | Franchises We Grant | | | | | Franchise Fee | Cumulative Development Fee | | You the Right to | | | | | | | | Develop | | | | 1 | $55,900 | $55,900 | | 2 | $50,900 | $106,800 | | 3 | $45,900 | $152,700 | | 4 | $40,900 | $193,600 | | 5 | $35,900 | $229,500 | | 6 | $30,900 | $260,400 | If we permit you to open more than six (6) Franchises under a Development Agreement, your Development Fee will be equal to (i) $260,400, plus (ii) $30,900 for each additional Franchise that we grant you the right to develop. You will be required to enter into our then current form of Franchise Agreement for each Franchise that you wish to open under your Development Agreement, but you will not be required to pay any additional initial franchise fee at the time you execute each of these franchise agreements. If you enter into a Development Agreement, you must execute our current form of franchise agreement for the initial Franchise we grant you the right to open within your Development Area, concurrently with the Development Agreement.
Source: Item 5 — INITIAL FEES (FDD pages 9–11)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, the initial franchise fee varies based on the population of the franchised territory. For a territory with a population between 50,000 and 200,000 people, the franchise fee is $55,900. If the territory's population is no more than 50,000 people, the fee is $29,000. This fee is due upon signing the Franchise Agreement and is considered fully earned by Pearce Bespoke upon payment, granting the franchisee the license to operate. The document specifies that this initial franchise fee is non-refundable under any circumstances and is applied uniformly to all franchisees.
Pearce Bespoke may also offer a Development Agreement for franchisees interested in developing multiple locations. The Development Fee depends on the number of franchises the franchisee is granted the right to open within a Development Area. The FDD outlines a tiered structure for these fees. For instance, the franchise fee for developing one franchise is $55,900, while developing two franchises incurs a fee of $50,900 per franchise, totaling $106,800. The fee decreases per franchise as the number of franchises increases, up to six franchises, where the fee is $30,900 per franchise, totaling $260,400.
If Pearce Bespoke permits a franchisee to open more than six franchises under a Development Agreement, the Development Fee is calculated as $260,400 plus $30,900 for each additional franchise the franchisee is granted the right to develop. Franchisees entering a Development Agreement must also execute Pearce Bespoke's current form of franchise agreement for the initial franchise concurrently with the Development Agreement. However, they will not be required to pay any additional initial franchise fees when executing subsequent franchise agreements under the Development Agreement.
In addition to the franchise fee, franchisees must also pay $8,000 per franchised territory for an Opening Inventory Package upon signing the Franchise Agreement. This package includes essential items for the initial start-up phase, such as a signature clothing trunk, mannequins, custom suits and clothing, and sample books. Franchisees are also required to purchase a Clothier Inventory Package for each clothier they hire, costing $2,700 per clothier, which includes a clothing trunk and sample books. These initial fees, including the Franchise Fee, Development Fee, Opening Inventory Package, On-Site Training, and Clothier Inventory Package, are deemed fully earned upon payment and are non-refundable.