Of the 31 units terminated in 2024, what were the primary reasons for termination? Were these related to non-compliance, underperformance, or other contractual violations?
#1
The termination rate of 15.9% is 2-3 times higher than typical for this category. What support or remediation programs does the franchisor provide before terminating franchisees?
#2
Given that median gross sales are $42,099, how do franchisees achieve profitability after paying 10% royalty plus 7% ad fund and $250 monthly technology fees?
#3
What specific business performance metrics or sales thresholds trigger automatic termination under the franchise agreement?
#4
The pending litigation case: what is the nature of this dispute, and what is the franchisor's position or expected timeline for resolution?
#5
Why has the ad fund rate of 7.0% been set significantly above the category typical range of 1.5-4.0%, and how is this fund allocated?
#6
The royalty rate of 10.0% is below typical (14.0-20.0%). Is this a limited promotional rate, and when might it increase?
#7
Territory is protected but non-exclusive. Can the franchisor place additional Toro Taxes franchisees within your designated territory, and under what circumstances?
#8
With a 15.9% annual termination rate, what is the average unit survival rate beyond year 3 and year 5?
#9
How many of the 24 net units added in the past year were new franchisees versus acquisitions of failed units?
#10
The non-compete restriction is 3 years and 25 miles, exceeding typical standards. What specific activities does this prohibit, and does it apply if you are terminated versus choosing not to renew?
#11
Has the franchisor enforced the non-compete clause against terminated franchisees, and are there documented cases?
#12
Item 19 shows average gross sales of $68,227. What percentage of franchisees fall below this average, and what is the distribution by quartile?
#13
The renewal fee is $2,500 but the transfer fee is also $2,500. If you want to renew for a second 10-year term, is the renewal fee in addition to or separate from any other fees?
#14
What is included in the franchisor's support services, given the Support & Training score of 93/100? Does this explain the high termination rate?
#15
Of the 3 litigation cases against the franchisor, what were the outcomes or settlements, and do any relate to franchise performance or royalty disputes?
#16
The system grew 12.3% despite 15.9% terminations. What is the franchisor's franchisee recruitment strategy, and how many applications do you receive annually?
#17
Are franchisees required to achieve minimum revenue targets in their first 1-3 years, and what happens if targets are missed?
#18
The initial term is 10 years. Are there early termination fees or exit options if a franchisee underperforms in years 1-5?
#19
Given the high termination rate and low sales figures, what is the average franchisee ROI and break-even timeline based on franchisees who remain active?
#20