When can a Pearce Bespoke franchisee open for business in relation to the initial franchise fee?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
s of a crisis that impacts the Pearce Bespoke brand and may cause harm or injury to the Pearce Bespoke Marks, Business System, reputation, or image.
4. INITIAL FRANCHISE FEE
Franchisee will pay Franchisor a non-refundable Initial Franchise Fee equal to the amount listed in ATTACHMENT A - FRANCHISEE SPECIFIC TERMS of this Agreement, which will be fully earned and payable on the date of this Agreement. The Initial Franchise Fee payable by Franchisee is payment to Franchisor for the costs that it will incur to get Franchisee into business including costs Franchisor incurs for training, territory evaluation, business overhead costs, travel costs, and for the other initial services Franchisor provides hereunder.
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, the timing of when a franchisee can open for business relative to the initial franchise fee depends on the state where the franchise is located. Generally, the initial franchise fee is fully earned and payable on the date of the Franchise Agreement. This fee compensates Pearce Bespoke for costs incurred to get the franchisee into business, including training, territory evaluation, business overhead, and travel.
However, there is an exception for franchisees in Minnesota. In Minnesota, Pearce Bespoke will defer the payment of the initial franchise fee, development fee, and any other initial payments until all material pre-opening obligations have been satisfied and the business is open and operating. Despite this deferral, the franchisee must still execute the Franchise Agreement before looking for a site or beginning training.
This means that in most states, a Pearce Bespoke franchisee will pay the initial franchise fee upfront upon signing the agreement, before the business is operational. In Minnesota, the franchisee has the benefit of delaying payment until the business is ready to open, reducing the initial financial burden and risk. Prospective franchisees should clarify with Pearce Bespoke which policy applies to their specific location and understand all pre-opening obligations.