The technology fee of $1,100 monthly is significantly higher than typical for home services franchises. What specific services and technology platforms does this fee cover, and are there any circumstances under which this fee could increase?
#1
Two litigation cases are currently pending against the franchisor. Can you provide details about the nature of these cases, the parties involved, and the anticipated timeline for resolution?
#2
All 6 franchised units were added within the past year. What is the franchisor's unit development plan for the next 3 and 5 years, and what are the retention expectations for these newly established units?
#3
The ad fund rate of 3.0% exceeds typical rates for this category. How is this fund allocated, what percentage goes toward digital marketing versus local/traditional marketing, and can franchisees review quarterly fund usage statements?
#4
Average gross sales of $1.38 million exceed the typical range for home services franchises. How many of the current 6 units have reached this sales level, and what is the sales range across the system?
#5
The franchise agreement requires 14 non-curable defaults that permit immediate termination. Which specific operational or contractual violations constitute non-curable defaults, and can you provide examples?
#6
Arbitration for disputes must occur in Bucks County, Pennsylvania. If you operate outside Pennsylvania, what are the costs and logistics implications of mandatory arbitration in this location?
#7
The minimum royalty of $500 per month begins in year two. How many current franchisees are paying this minimum, and what percentage of franchisees fall below or significantly exceed this threshold?
#8
Late payment interest is 18% annually. Are there any grace periods, payment plans, or hardship provisions available if a franchisee experiences cash flow challenges?
#9
Personal guarantees are required from the franchisee, spouse, and principal shareholders/members. Will the franchisor pursue personal assets in case of breach, and are there any limitations or caps on this liability?
#10
The non-compete restriction covers 25 miles and lasts 2 years post-termination. Has this restriction been enforced against any departed franchisees, and are there any exceptions or modifications available?
#11
Renewal requires meeting 9 specified conditions. Can you provide the complete list of renewal conditions, and what percentage of franchisees historically meet these conditions at renewal?
#12
The renewal fee of $11,900 equals 20% of the then-current initial franchise fee. How has the initial franchise fee changed over time, and what is the franchisor's projection for renewal fees in future years?
#13
As a newly launched system with all units from the past year, what franchisor support infrastructure is in place for training, operations, marketing, and ongoing field support?
#14
Two pending litigation cases exist despite the system having only 6 units and being in operation for less than 2 years. What specific disputes led to these cases, and do they involve franchisees, customers, or other parties?
#15
The royalty rate of 5.0% is below the typical 6.0-7.0% range, but the technology fee of $1,100 monthly is above typical. What is the total effective ongoing fee percentage when technology and royalties are combined?
#16
What happens to franchisees if the franchisor's own financial condition deteriorates or if the company files for bankruptcy while franchisees' agreements are active?
#17
Can franchisees negotiate any of the key terms in the franchise agreement, such as royalty rates, technology fees, territory size, or term length, or are these fixed for all franchisees?
#18