What explains the exceptionally high unit growth of 77.8% in the past year compared to typical franchise systems in this category? Are you planning to continue this aggressive expansion pace?
#1
Given zero reported closures or terminations since 2022, can you provide details on any franchisee financial performance, complaints, or operational challenges that may not yet have resulted in formal exits?
#2
Why is the initial franchise term set at 7 years instead of the more typical 10-year term for fast casual restaurants? Does this shorter term affect franchisee investment decisions?
#3
The technology fee of $43/month is significantly lower than the typical $200-$500 range. What specific technology services and support does this fee cover, and are there any additional technology costs franchisees should anticipate?
#4
The transfer fee of $30,000 exceeds typical transfer fees by 50%. How is this fee calculated, and what does it include? Are there circumstances where this fee might be negotiated?
#5
With no exclusive territory granted, what strategies does the franchisor use to prevent encroachment? How are multi-unit operators protected from internal competition?
#6
The Support & Training score of 85 falls below the typical range. What specific training programs and ongoing support are provided to franchisees, and how does this compare to competitors?
#7
Can you detail the 12 termination causes in the franchise agreement and provide examples of how each has been applied historically?
#8
The renewal conditions count of 5 is lower than typical. What are these specific renewal conditions, and what percentage of franchisees successfully renew their agreements?
#9
Have there been any disputes or disagreements with franchisees that didn't result in formal litigation due to the mandatory arbitration clause? Can you share the general nature and resolution of these disputes?
#10
What is the typical franchisee investment broken down by category (equipment, buildout, working capital, etc.), and how does actual franchisee experience compare to projections?
#11
How many of the current 16 units are owned by multi-unit operators versus single-unit franchisees? What multi-unit incentives exist?
#12
Given the rapid growth from 4 units (3 years ago) to 16 units (today), what challenges have you encountered in maintaining brand consistency and quality control?
#13
Can you provide financial performance data (sales, profitability) for units opened in different years? How do newer units compare to established units?
#14
What happens to the $10,000 renewal fee? Is it applied to franchise fee credits, or is it a separate cost in addition to other renewal obligations?
#15
The non-compete clause restricts activity for 2 years within 10 miles. How is this enforced, and have there been instances where former franchisees attempted to operate competing concepts within this territory?
#16
Personal guarantees are required from franchisees, owners, shareholders, members, partners, and spouses. Are there any circumstances where this requirement can be modified or waived?
#17
You require use of only company-approved suppliers for 15 categories. How many approved suppliers exist per category, and what is the franchisor's markup or commission structure on approved supplier relationships?
#18
What has driven the expansion from 4 to 16 units so quickly? Were these all franchisee-initiated openings, or did you open some units corporately? What is your growth strategy for the next 3-5 years?
#19