Is the amount of the Red Wagon Club technology fee subject to increase?
Red_Wagon_Club Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Technology Fee | Not currently assessed | If assessed, monthly, the 10th of each month | We do not currently charge this fee but may do so for technology that we or our affiliates develop or license to you and for other maintenance, support, and technology development services that we or our affiliates provide. The amount of this fee is subject to increase at our discretion commensurate with the technology used in the operation of RWC Businesses; provided, that we will not increase this fee by more than $500 in any given month of the term of a Franchise Agreement. We anticipate that you would pay these amounts directly to designated third-party vendors, but we may require you to pay us the Technology Fee directly. |
Source: Item 6 — OTHER FEES (FDD pages 13–17)
What This Means (2024 FDD)
According to Red Wagon Club's 2024 Franchise Disclosure Document, the technology fee, while not currently assessed, is subject to increase at the franchisor's discretion. This fee would be for technology that Red Wagon Club or its affiliates develop or license and for related maintenance, support, and technology development services.
While the fee is not currently charged, Red Wagon Club retains the right to implement it in the future. If implemented, the amount of the technology fee can be increased. However, Red Wagon Club specifies that any increase is limited to a maximum of $500 in any given month during the term of the Franchise Agreement.
It's important to note that while Red Wagon Club anticipates franchisees would pay these amounts directly to third-party vendors, they may require franchisees to pay the Technology Fee directly to them. This gives Red Wagon Club flexibility in how they manage and administer technology-related services and costs within the franchise system. Prospective franchisees should factor in the potential for this fee and its incremental increases when assessing the overall cost of investment.