Brooklyn Dumpling Shop
Brooklyn Dumpling Shop offers fast-casual restaurants featuring freshly-prepared dumplings with various fillings served via automat. Known for its proprietary sauces and marinades, this franchise operates in the casual dining sector.
Brooklyn Dumpling Shop franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operating a Brooklyn Dumpling Shop franchise ranges from $373,278 to $721,778. This range includes an amount between $60,000 and $70,000 that must be paid to the franchisor or its affiliates [p.1].
What is the initial franchise fee?
The initial franchise fee is $45,000 [p.13, p.62]. This payment is fully earned by the franchisor when you sign the Franchise Agreement and is not refundable under any circumstances [p.13, p.62].
What are the ongoing royalty and advertising fees?
The ongoing royalty fee is 6% of Gross Revenue [p.62]. For advertising, Franchisee must spend at least 1% of their monthly Gross Revenue on Local Advertising, with a minimum of $500 per month [p.80].
How long is the initial franchise agreement, and can I renew it?
The initial franchise agreement term is 10 years, as defined in Section 8 [p.60]. You have the right to enter into a successor agreement for one additional 10-year term upon expiration of the initial term, subject to certain conditions [p.60].
Can I sell or transfer my franchise, and what does that require?
According to the FDD, a franchisor can refuse to permit the transfer of ownership of a franchise except for good cause [p.6]. Good cause is not defined in the excerpts but generally includes reasons such as financial issues or non-compliance with franchise standards. This means you cannot freely sell or transfer your franchise without the franchisor's approval.
On what grounds can the franchisor terminate the agreement?
According to [p.205], a franchisor cannot cancel a franchise without reasonable cause, as defined by Virginia law or the Virginia Retail Franchising Act. Additionally, [p.6] states that termination is only permissible for good cause, which includes failure to comply with lawful provisions of the franchise agreement and not being cured within a reasonable time frame (no more than 30 days).
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts.
Do I get an exclusive or protected territory?
No, you do not receive an exclusive territory. You may face competition from other franchisees, outlets owned by the company, or other channels of distribution or competitive brands that the company controls within your designated area [p.34]. However, there are no minimum sales volumes or market penetration requirements that would affect your right to operate in the territory during the term of the Franchise Agreement, unless you are in default of your obligations [p.34].
What training and ongoing support does the franchisor provide?
The franchisor provides initial management training through a mandatory program that must be completed by all principals, general manager, and two managers before opening. This includes attendance at an Initial Training Program in Hoboken, New Jersey, or another location designated by the franchisor [p.64]. Additionally, the franchisor offers on-site post-opening assistance for up to 10 days around the Opening Date, known as Pre-Opening Assistance and Training [p.72]. For extending this training beyond the initial 10-day period, the franchisee must pay a per diem fee and cover travel, lodging, and meals. The franchisor also offers remedial on-site training upon request or at their discretion for an additional cost [p.66].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts. The FDD does not provide a current count of franchised outlets or details on those that have closed or been terminated. However, it mentions that such information will be included in Exhibit F if applicable.
Does the franchisor share any financial performance or earnings information?
The franchisor does not provide representations about a franchisee's future financial performance or the past financial performance of company-owned or franchised outlets [p.48]. However, if you are purchasing an existing outlet, they may provide actual records of that specific outlet [p.48]. Additionally, no employee of Fransmart or other person speaking on behalf of the franchisor has made any statement or promise concerning the revenues, profits, opening costs, or operating costs of any particular franchise business that is contrary to or different from the information contained in the Disclosure Document [p.125] and [p.214].
What am I restricted to selling, and where must I buy supplies?
You are restricted to selling food and beverage service within the Franchised Business location only, excluding certain specified activities like online sales, dealer/distributor sales, or delivery outside your designated territory. You may have to buy or lease items from the franchisor or a limited group of suppliers they designate, which could be more expensive than other options [p.4].