The technology fee of $500 monthly is significantly higher than the typical range of $110-$408 for quick service restaurants. What specific technology services and platforms does this fee cover, and are there any cost reduction options or tiered pricing as the system grows?
#1
Your System Health score of 35 is substantially below the typical range of 50-75 for this category. What specific operational, training, or support challenges is the franchisor addressing to improve this metric?
#2
The non-compete restriction of 25 miles is more than double the typical range of 5-10 miles. How does the franchisor justify this extended geographic restriction, and are there any carve-outs or exceptions to this policy?
#3
Your non-compete duration is 1 year, below the typical 2-year range. Can you clarify whether this refers only to the post-termination period, and do non-renewal situations carry different restrictions?
#4
The agreement lists 11 termination causes, which is below the typical range of 15-20. Can you provide the complete list of non-curable defaults beyond bankruptcy, abandonment, and criminal conduct mentioned in the summary?
#5
One unit closed in 2024. Can you provide details about the reason for this closure, whether it was franchisee-initiated or franchisor-directed, and what support was offered to prevent it?
#6
The ad fund rate of 1.0% is below the typical 2.0-4.0% range. How is this relatively low ad fund allocation being used to market the brand, and what are the financial commitments to national or regional advertising?
#7
Your franchise fee of $20,000 is significantly lower than the typical range of $25,000-$37,500. What is included in this lower initial fee, and are there additional startup or training costs not captured in this figure?
#8
Item 19 financial data shows median gross sales of $891,230. How many units reported these figures, and do these projections include or exclude food costs and other variable operating expenses?
#9
The agreement requires personal guarantees with joint and several liability from owners of 20% or more. Can you explain the scope of personal liability and whether this is negotiable based on franchisee financial strength or experience?
#10
What are the specific 8 renewal conditions beyond compliance, solvency, and renewal fees? Are physical modifications required at every renewal, and what is the estimated cost for these mandatory updates?
#11
The system grew from 9 to 15 units in 3 years (18.6% CAGR), but net unit growth in the past year was 0%. Can you clarify what happened in 2024—were new units opened but others closed, or did growth stall?
#12
Given the 10-business-day cure period for law violations, can you provide examples of what violations have triggered this provision and how disputes have been resolved?
#13
The Territory score of 85 is well above the typical range of 50-75. What specific territory protections and encroachment policies support this high score?
#14
Transfer fees are $10,000 and renewal fees are $5,000. Are these fees refundable under any circumstances, and are there any alternative paths to transfer or renewal that could reduce these costs?
#15
Support & Training is scored at 88, slightly below the typical 90-100 range. What specific training programs and ongoing support are provided, and are there any gaps the franchisor plans to address?
#16
No litigation has been reported in the franchisor's history. Is this a recently established brand, or does the zero-litigation record reflect a longer operating history? If established, how many years has the system been operating?
#17
The 6.7% closure rate in year one is at the upper boundary of typical ranges. Is this rate typical for RAKKAN Ramen or part of a broader economic trend affecting ramen concepts, and what causes have driven recent closures?
#18
Are there any restrictions on what type of location a RAKKAN unit can operate in (e.g., mall food courts vs. standalone storefronts), and does location type affect unit economics or failure rates?
#19
What post-termination or non-renewal support does the franchisor provide to exiting franchisees, and are there any obligations to help transition unit operations or assist with the sale of franchise agreements?
#20