Can you provide details on the two units that ceased operations in 2022, including whether the closures were franchisee-initiated exits or caused by business performance issues?
#1
How is the $50,000 transfer fee justified relative to other comparable franchise systems, and are there circumstances under which this fee can be negotiated or waived?
#2
The ad fund rate of 5.0% is significantly higher than typical for this category. How are these funds utilized, and what has been the return on investment in marketing and advertising for existing franchisees?
#3
With only 12 units in the entire system, how does the franchisor support franchisees in securing customers and maintaining competitive market positioning against established national competitors?
#4
Can you explain the specific conditions referenced in the renewal clause that franchisees must satisfy beyond the 8 enumerated conditions, and how discretionary are these additional conditions?
#5
Has the franchisor ever denied a franchisee renewal request, and if so, what were the grounds for denial?
#6
The Investment Cost score is 15/100, well below typical ranges. What is the actual total startup cost for a new franchisee, including initial inventory, equipment, and working capital?
#7
Are there financial performance benchmarks or Item 19 disclosures available that show typical unit economics, gross revenues, or profitability for franchisees?
#8
What specific restrictions apply during the 2-year, 30-mile non-compete period, and does this restriction apply to all ownership structures or only individual franchisees?
#9
The dispute resolution clause mandates arbitration in Miami, Florida. Are there any circumstances where franchisees can pursue litigation in their home jurisdiction instead of arbitration?
#10
How many of the current 12 units are company-owned versus franchisee-owned, and what has been the franchisor's expansion strategy over the past 3 years?
#11
What training and ongoing support are franchisees provided (given the 100/100 Support & Training score), and are there any costs associated with continued training or support beyond the royalty rate?
#12
Can you provide specific examples of how the franchisor has protected franchisees from encroachment, given the exclusive territory designation?
#13
What happens to a franchisee's territory if they fail to renew, and can the franchisor reassign that territory to a competing applicant immediately or after a waiting period?
#14
Are there any provisions in the franchise agreement that allow the franchisor to modify the royalty rate, ad fund rate, or other ongoing fees during the term or at renewal?
#15
Given the personal guarantee requirement from all partners, shareholders, members, and spouses, what are the specific legal implications if the business fails to meet payment obligations?
#16
How many franchisees are currently actively operating in the 12-unit system, and are there any units that are owned but not actively operating?
#17
What is the historical success rate or average lifespan of franchisees in this system, and how many units have been sold or transferred back to the franchisor?
#18