District Taco

The franchise fee of $25,000 is significantly below the category average of $35,000-$40,000. What justifies this lower entry cost, and are there any required upfront costs not reflected in the franchise fee that prospective franchisees should anticipate?

Your technology fee of $100/month is substantially lower than the typical range of $200-$500/month for fast casual restaurants. What technology systems and support are included, and have you considered increasing this fee in future franchise offerings?

Financial performance data shows above-average unit sales (median $1.99M vs. category average ~$1.5M). What are the key operational or location factors that drive this outperformance, and are these replicable across different markets?

Only 4 renewal conditions are specified compared to the typical 6-9 for this category. Can you detail the specific conditions franchisees must meet for renewal, and what happens if a franchisee fails to meet one or more conditions?

The non-compete radius of 25 miles exceeds the typical range of 5-20 miles. How did you determine this specific radius, and does it vary by market or population density?

Two units closed in 2022 and 2023 out of a 14-15 unit system (6.7% exit rate). What were the stated reasons for these closures, and what support or interventions did the franchisor provide before these units exited?

The transfer fee of $5,000 is below typical ranges. Given the low transfer fee and protected but non-exclusive territory, how do you manage potential conflicts if a franchisee wants to transfer their unit to a buyer in an adjacent or overlapping service area?

Item 19 financial performance data is provided, but how many of your 15 units actually reported sales figures, and does the disclosed data represent all reporting units or a subset?

Can you provide specific examples of the 'minimum performance standards' referenced in your financial obligations section, including thresholds for unit closures or remediation requirements?

Regarding mandatory suppliers across 6 categories: what is the franchisor's financial relationship with these suppliers, and how are supplier terms negotiated or verified for competitiveness?

The dispute resolution clause requires binding arbitration with class action waiver. Have you received any arbitration claims since adopting this clause, and if so, what were the outcomes?

Personal guarantees are required from all franchise owners. Are there any circumstances under which this requirement can be waived, and what recourse does the franchisor pursue if a franchisee defaults?

Late payment interest is assessed at 1% monthly (12% annually). How frequently do franchisees fall behind on royalty or other fee payments, and what is your collections process?

The renewal fee is listed as 'N/A' in the data. What is the actual renewal fee upon the second 10-year term, and does it equal the current franchise fee or increase based on inflation or market conditions?

The territory is protected but non-exclusive. Can the franchisor open a District Taco location within your territory, and if so, under what circumstances and how is compensation determined?

What specific support and training are included in your 100/100 Support & Training score, particularly regarding site selection, construction, opening, and ongoing operational support?

Given your strong financial performance data, what is the typical return on investment and payback period for franchisees, and are these figures supported by audited data from existing operators?

Can you clarify the cure periods referenced in your termination clause—specifically, what constitutes a 24-hour cure for 'law violations' and what types of violations fall into non-curable defaults?

The advertising cooperative is mandatory. How are cooperative fees assessed, how is spending allocated across locations, and do individual franchisees have any governance or veto rights over cooperative decisions?

With only 15 units in the system, what are your growth targets for the next 3-5 years, and what territories or markets are you prioritizing for expansion?