Schmackarys
Schmackarys operates bakeries offering over 50 varieties of cookies and specialty treats. Known for its diverse cookie selection and additional offerings like ice cream and coffee, Schmackarys franchises range from single to multi-unit operations with significant investment requirements.
Schmackarys franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin the operation of a Schmackary's franchised business ranges from $266,650 to $656,500. This includes a mandatory payment of $30,000 to the franchisor or its affiliate(s). [p.1]
What is the initial franchise fee?
The initial franchise fee is $30,000 and it is fully earned at the time the Franchise Agreement is signed; this payment is not refundable under any circumstances. [p.11, p.62]
What are the ongoing royalty and advertising fees?
The franchisee is required to pay a monthly royalty fee of six percent (6%) of Gross Revenue [p.62]. Additionally, the franchisee must spend at least one percent (1%) of their Gross Revenue per month on local advertising for the franchised business in the territory ('Local Advertising') [p.82].
How long is the initial franchise agreement, and can I renew it?
The term length of the initial franchise agreement isn't specified in these excerpts. Additionally, while the document mentions provisions for potential changes and non-renewal without fair compensation under certain conditions [p.6], it does not provide specific details on the renewal process or term length of the agreement.
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 includes but is not limited to unspecified factors, and this provision does not prevent the franchisor from exercising a right of first refusal to purchase the franchise.
On what grounds can the franchisor terminate the agreement?
According to [p.192] and [p.6], a franchisor can terminate the agreement on any grounds available by law, but such termination must be for good cause. Good cause includes failure to comply with lawful provisions of the franchise agreement and not curing such failures after written notice and a reasonable opportunity to cure, which cannot exceed 30 days. Additionally, [p.208] mentions that RCW 19.100.180 or court decisions may supersede the franchise agreement in areas including termination.
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts. The FDD does not provide specific details on net worth or liquid capital requirements for qualification as a franchisee. [p.91] mentions that the transferee must have sufficient business experience, aptitude, and financial resources to operate the Franchised Business, but it does not quantify these financial resources.
Do I get an exclusive or protected territory?
No, you do not receive an exclusive territory. According to [p.33], unit franchisees and multi-unit operators will not receive an exclusive territory, meaning you may face competition from other Schmackary's outlets owned by the company or other channels of distribution within your designated area.
What training and ongoing support does the franchisor provide?
The franchisor provides initial training at its headquarters or another specified location, including the Operations Manual and other beneficial materials [p.32]. Additionally, on-site post-opening assistance is available for up to 10 days around the opening date, included in the Initial Franchise Fee [p.73]. For further training needs, the franchisor can provide remedial on-site training upon request, with associated costs [p.66].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts.
Does the franchisor share any financial performance or earnings information?
The franchisor may provide actual records of an existing outlet's performance if you are purchasing one, but generally does not share financial performance or earnings projections with prospective franchisees. This information is only permissible if it is already disclosed in Item 19 of the FDD and no additional oral representations about future financial performance are made [p.50, p.48, p.129, p.214].
What am I restricted to selling, and where must I buy supplies?
You are restricted to offering and selling all products and services that are part of the System, as well as any future additions to the System. You may set your own prices for these items but must adhere to maximum price recommendations from the franchisor [p.38]. For supplies, you must purchase or lease items from the franchisor-designated suppliers or in accordance with their specifications [p.4 and p.22].