The royalty rate of 10% is significantly higher than the typical range of 5.25-7% for real estate service franchises. What justifies this premium royalty structure compared to competitors?
#1
Can you provide historical context for the 1 unit closure in 2024? Was it due to franchisee default, voluntary exit, or franchisor termination?
#2
The system reports zero turnover and zero terminations over the past 3 years. How do you retain franchisees at rates substantially above industry norms, and what is the average franchisee tenure?
#3
Does the 10% royalty rate include all ongoing support services, or are there additional fees beyond the stated $120 monthly technology fee and 2% ad fund?
#4
The franchise agreement requires personal guarantees from all owners and their spouses without limitation. Under what circumstances would the franchisor enforce these guarantees?
#5
Regarding the binding arbitration clause: what disputes have arisen in your franchise system to date, even though no formal litigation is recorded?
#6
The territory is protected but not exclusive. Can you define how encroachment protection is enforced, and have there been disputes where the franchisor allowed additional franchisees in a defined territory?
#7
With only 13 termination causes listed in the agreement versus the typical 15-20, what specific grounds for termination are NOT included compared to industry standards?
#8
The $10,000 transfer fee represents a significant cost. Is this fee negotiable, and can you provide examples of approved and denied transfer requests in recent years?
#9
How are the Item 19 financial performance figures ($127,195 median gross sales) validated? What percentage of current franchisees report these figures, and are there specific location or experience requirements that affect results?
#10
Given the strong 3-year growth rate of 8.37% CAGR, what market expansion plans exist over the next 3-5 years, and how might increased competition from new units affect existing franchisee performance?
#11
The support and training score (81) is above typical range. What specific training and ongoing support services justify this premium positioning?
#12
Can you clarify the renewal process for the 2 x 5-year options? Are renewal fees required, and under what conditions might renewal be denied?
#13
The non-compete clause specifies 2 years but shows 'N/A miles.' Are there geographical limitations to this non-compete, and how is compliance monitored post-exit?
#14
What is the renewal fee amount, if any, for the two 5-year renewal options? This was not disclosed in the available materials.
#15
How does the franchisor handle disputes regarding commission calculations, client disputes, or valuation accuracy claims—through arbitration, mediation, or another process?
#16
The technology fee of $120 monthly is the only per-unit technology cost disclosed. Are franchisees subject to additional technology or software mandatory purchases outside this fee?
#17
What specific training curriculum is provided at franchise launch, and what are the ongoing training requirements? How many hours of training can new franchisees expect?
#18
Among the 42 current units, how many were opened in each of the past 3 years, and what percentage of franchisees have exceeded the median gross sales figure of $127,195?
#19