Can you provide detailed reasons for the 7-unit net decline over the past 3 years, and specifically explain the 3 'ceased other' units in 2022?
#1
What specific support and training services are included in the franchise agreement, given that Support & Training scores below the typical range at 75?
#2
The Financial Performance score is 40, well below the typical range of 43-60. Can you clarify why no Item 19 financial performance data is provided, and are you willing to provide franchisee financial results or case studies?
#3
Why is the total potential contract term only 5 years when the typical range for this franchise type is 10-20 years? What are the renewal options available after the initial 5-year term?
#4
The technology fee of $99/month is below typical for this category. What technology platform and services does this cover, and how frequently are updates or enhancements implemented?
#5
Territory is protected but not exclusive. Can you define the specific geographic boundaries of protected territory and explain what protections exist against franchisor-initiated encroachment?
#6
There are only 7 termination causes listed in the franchise agreement versus a typical range of 14-22. What are the specific performance standards that could trigger termination, and under what circumstances would you allow contract buyout or cure periods?
#7
Can you provide a detailed breakdown of the 4 unit closures in 2024, including owner demographics, average time in business before closure, and profitability status at time of exit?
#8
The transfer fee is $13,250. What services and approval process are included in this fee, and under what circumstances could transfer requests be denied?
#9
Given the 2-year non-compete clause with no specified mileage, what geographic restrictions would apply post-exit, and how is this enforced?
#10
The franchise fee of $29,500 is below the typical range. What is included in the initial investment estimate, and what are the most common hidden or unexpected costs reported by franchisees?
#11
What is the typical royalty structure and ad fund requirement, and why are these not disclosed in the franchise disclosure document?
#12
Can you provide performance metrics for franchisees who have been in the system for 1, 3, and 5+ years, broken down by territory type and initial investment level?
#13
Personal and unconditional guarantees are required from all owners, potentially including spouses. Under what circumstances could these guarantees be enforced, and what are the personal liability limits?
#14
No litigation cases appear in the past 3 years, which is favorable. Can you confirm there are no pending disputes or regulatory investigations involving the franchisor or system units?
#15
How does the 4.0% annual exit rate in the past year compare to the system's historical average, and what specific actions is the franchisor taking to improve unit retention?
#16
What happens if a franchisee chooses not to renew after the initial 5-year term? Are there renewal fee requirements, and is the non-compete period applied to non-renewals?
#17
Can you explain the 1.0% non-renewal rate reported for the past year? How many franchisees chose not to renew, and what were their stated reasons?
#18