The franchise fee of $80,000 is more than double the typical range for quick service restaurants. What specific services, training, or support justify this premium franchise fee compared to competitors?
#1
Your royalty rate of 8.0% is higher than the typical 5.0-6.0% range for QSR franchises. How does this rate compare to competitors in the sandwich/quick service segment, and is it negotiable?
#2
The data shows 5 units closed in 2022-2023 but zero reported terminations or non-renewals. Were all 5 closures voluntary owner decisions, and what were the primary reasons cited by departing franchisees?
#3
Despite zero reported turnover in the current year, 4 units closed in 2023. Can you provide more detail on whether any of these former franchisees faced difficulties and what challenges they encountered?
#4
The non-compete restriction extends 20 miles post-termination, which is double the typical range. How strictly is this enforced, and have there been any disputes with former franchisees over this distance requirement?
#5
Financial data shows average gross sales of $981,671. What percentage of current units meet or exceed this average, and how many units fall below this threshold?
#6
The franchise agreement requires personal guarantees from all principals and spouse liability for financial obligations. How frequently has the franchisor exercised personal guarantees against former franchisees, and what were the circumstances?
#7
Your renewal conditions require 8 specified conditions and refurbishment/renovation. What is the typical cost of completing the required renovations to renew a franchise, and what percentage of franchisees successfully renew versus elect not to?
#8
The franchise mandates products and supplies from franchisor-approved suppliers. What is the typical markup on these proprietary supplies compared to market alternatives, and are there any mandatory minimum purchasing requirements?
#9
The agreement provides only 5 days to cure payment defaults. Given the operational demands of a quick service restaurant, how often do franchisees miss the 5-day cure window, and what are the consequences?
#10
You report zero litigation in the past 3 years. How does this compare to the previous 3-year period, and are there any pending disputes not yet classified as formal litigation?
#11
The territory is protected but not exclusive. Can the franchisor open company-owned locations or additional franchises in your assigned territory, and under what circumstances?
#12
The agreement lists 20 categories of non-curable defaults allowing immediate termination. Can you provide specific examples of what actions constitute non-curable defaults to help me understand termination risk?
#13
With Item 19 financial data available, what is the median unit volume broken down by franchisee experience level (first year vs. established units) and by geographic region?
#14
The system grew from 94 to 103 units over 3 years despite closures. Are all new units franchised locations, or does this include company-owned expansion?
#15
The franchise fee includes training and initial support. If a franchisee needs additional training or support after opening, what are the costs and how are these services charged?
#16
The renewal fee is $5,000 plus refurbishment costs. What is the average total cost franchisees have incurred to complete renewals, and do you provide financing options for renewal refurbishment?
#17
What is the franchisor's policy on approving new suppliers or allowing franchisees to source approved items from multiple suppliers to manage costs?
#18
The technology fee of $200 covers which specific systems, and can you outline all anticipated technology investments required over the 20-year term?
#19
Have any franchisees challenged the non-compete restrictions post-termination, and what was the outcome of those disputes?
#20