What is the formula for calculating the transfer fee for a Pearce Bespoke franchise?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
tes, agreements, or security interests reserved in the Pearce Bespoke Franchise are subordinate to the transfereefranchisee's obligations to pay Royalty Fees or any other amounts due to Franchisor under the Franchise Agreement;
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- The transferee-franchisee successfully completes Franchisor's training program; and Franchisee pays Franchisor a transfer fee equal to the greater of (i) Ten Thousand Dollars ($10,000.00), or (ii) twenty five percent (2
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, a franchisee who transfers their franchise must pay a transfer fee to Pearce Bespoke. The transfer fee is the greater of two amounts: $10,000.00, or 25% of the then-current Initial Franchise Fee. This fee covers Pearce Bespoke's costs associated with the transfer, including any required training for the new franchisee.
This transfer fee is standard in the franchise industry, as the franchisor needs to vet and train the new franchisee to ensure they meet the brand's standards. The fee compensates Pearce Bespoke for their time and resources in this process. However, there is an exception: no transfer fee is payable for transfers to immediate family members, defined as a spouse or children.
It is important to note that the transfer is conditional on the successful completion of Pearce Bespoke's training program by the transferee. This ensures that the new franchisee is adequately prepared to operate the business according to Pearce Bespoke's standards. Additionally, Pearce Bespoke retains the right to assess the purchase price and payment terms of the transfer to ensure they do not adversely affect the transferee's ability to operate the franchise successfully.