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Considering a Kidcreate Studio Franchise? Don’t Overlook These 25 Important Franchise Fees

by Franchise Chatter on March 17, 2017

in Art-Related Franchise, Child-Related Franchises, Franchise Fees



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Don't Invest in a Franchise Until You Check Out This List

If you are considering a Kidcreate Studio franchise, don’t get blindsided by these 25 important franchise fees (from the initial franchise fee, to the royalty fee, to 23 other fees found in Items 5 and 6 of Kidcreate Studio’s 2016 FDD).

1.  Initial Franchise Fee:  $39,000

  • You must pay Kidcreate Studio an initial franchise fee (“Initial Franchise Fee”) when you sign the Franchise Agreement. The Initial Franchise Fee for a Kidcreate Studio Franchise is $39,000.
  • The standard Kidcreate Studio Franchise includes a protected territory (“Territory”) that contains approximately 55,000 to 65,000 “Qualified Households.” Qualified Households are households with an annual income of $75,000 or more as determined by the most recent U.S. census data.
  • Initial Franchise Fees are due in full when you sign the Franchise Agreement. The Initial Franchise Fee is uniform, earned by Kidcreate Studio when paid, and is not refundable.

2.  Additional Territory Fee:  $.40 per Qualified Household above 40,000 in the Territory

  • In certain circumstances, franchisees have the option to expand the Territory, subject to availability and Kidcreate Studio’s approval. The fee for each additional Territory will be determined at the time of your purchase, and is $.40 per Qualified Household above 40,000 in the Territory (“Additional Territory Fee”).
  • Kidcreate Studio will identify the population in any proposed territory by referring to the most recent available U.S. Census data.
  • The Additional Territory Fee is due within 15 days after the Territory is determined, and is non-refundable.

3.  Location Assistance Fee:  $12,500 for the first Kidcreate Studio Franchise that you purchase, and $5,000 for each additional Kidcreate Studio Franchise that you purchase



  • In addition to the Initial Franchise Fee, you must pay Kidcreate Studio a “Location Assistance Fee” of $12,500 for the first Kidcreate Studio Franchise that you purchase, and $5,000 for each additional Kidcreate Studio Franchise that you purchase.
  • The Location Assistance Fee offsets the costs in supporting your efforts to find, develop, and open the Studio (“Location Assistance”).
  • The Location Assistance Fee is uniform, non-refundable, and due when you sign the Franchise Agreement.

4.  Opening Extension Fee:  $1,000 per month until the Kidcreate Studio Business is open

  • If you fail to open the Kidcreate Studio Business within 12 months of signing the Franchise Agreement, you will be required to pay Kidcreate Studio an “Opening Extension Fee” of $1,000 per month until the Kidcreate Studio Business is open, or it will terminate the Franchise Agreement.

5.  Opening Inventory:  $500 to $2,000

  • You must purchase certain branded opening supplies and inventory items from Kidcreate Studio prior to opening your Studio. Kidcreate Studio estimates that your costs for these items will range from $500 to $2,000.
  • These payments are non-refundable.

6.  Royalty:  8% of Gross Sales

  • Due Date:  Within 5 days after the end of the calendar month.
  • You must pay your “Royalty” via electronic funds transfer (“EFT”), or such other manner Kidcreate Studio may prescribe.

7.  Brand Fund Contribution:  2% of Gross Sales

  • Due Date:  Same as Royalty.
  • This contribution will be used for a system-wide “Brand Fund” for Kidcreate Studio’s use in promoting and building the Kidcreate Studio brand.

8.  Local Advertising Payment:  the difference between the amount you spent on local advertising each month and your required local advertising expenditure (the greater of: (a) $500; and (b) 3% of your Gross Sales during the previous calendar month)

  • Due Date:  Payable after receipt of invoice.
  • If you fail to meet your required local advertising requirement on local advertising, you must pay Kidcreate Studio the difference between the amount you spent and the required advertising expenditure, which will be contributed to the Brand Fund.

9.  Local and Regional Advertising Cooperatives:  2% of Gross Sales

  • Due Date:  Within 5 days after the end of the calendar month (or as Kidcreate Studio designates).
  • Kidcreate Studio currently does not have a cooperative, but reserves the right to require one to be established in the future.

10.  Insurance:  reimbursement of Kidcreate Studio’s costs, plus a 20% administration charge

  • Due Date:  On demand.
  • If you fail to obtain insurance, Kidcreate Studio may obtain insurance for you, and you must reimburse it for the cost of insurance obtained, plus 20% of the premium as an administrative cost of obtaining the insurance.

11.  Training Fee at Kidcreate Studio’s Location:  then-current charge (currently $500 per person per day), plus expenses

  • Due Date:  As incurred.
  • Kidcreate Studio provides initial training at no cost for up to two people; it may charge you for training additional persons, newly-hired personnel, refresher training courses, advanced training courses, and additional or special assistance or training you need or request.
  • The fee amount will depend on the training required.

12.  Additional Training or Assistance at Your Location:  then-current fee (currently $500 per day per additional person for initial training, and $500 per attendee per day for additional training), plus Kidcreate Studio’s representative’s travel and living expenses

  • Due Date:  As incurred.
  • Kidcreate Studio provides a minimum of two days and up to four days of on-site assistance. It provides initial training at no charge for up to two people.
  • It may charge you for training additional persons, newly-hired personnel, refresher training courses, advanced training courses, and additional or special assistance or training you need or request. You will be required to pay for Kidcreate Studio’s instructors’ travel expenses as well.

13.  Technology Fee:  then-current charge (currently $500 per month)



  • Due Date:  Same as Royalty.
  • For use of Kidcreate Studio’s online systems, e-mail, data sharing, and other Internet-related functions.
  • Kidcreate Studio reserves the right to increase this fee in the event it offers updated or additional software or technology for use in the Kidcreate Studio Franchise.

14.  Mystery Shopper Fee:  will vary under circumstances, but Kidcreate Studio estimates the cost of such inspections will not exceed $200 per inspection

  • Due Date:  As incurred.
  • You must reimburse Kidcreate Studio for its costs and expenses associated with the inspections of third-party mystery shoppers who will pose as normal customers and perform specific tasks (such as attend lessons, ask questions, or seek customer service), and evaluate the services received at your Kidcreate Studio Business.

15.  Convention Fee:  $2,000 for up to 2 attendees (of which $500 is credited back if at least 1 attends), plus expenses; and $500 for each additional attendee, plus expenses

  • Due Date:  As incurred.
  • The “Convention Fee” is payable to Kidcreate Studio to help defray the cost of your attendance at the convention(s). Kidcreate Studio reserves the right to charge this fee whether or not you attend the conference.

16.  Supplier and Product Evaluation Fee:  costs of inspection (estimated to be approximately $100 to $500)

  • Due Date:  As incurred.
  • Payable if Kidcreate Studio inspects a new product, service, or proposed supplier nominated by you.

17.  Interest:  lesser of 1.5% per month, or highest commercial contract interest rate allowed by law

  • Due Date:  As incurred.
  • Due on all overdue amounts and accruing as of the original due date.

18.  Insufficient Funds Fee:  $100 per occurrence

  • Due Date:  As incurred.
  • Payable if any check or EFT payment is not successful due to insufficient funds, stop payment, or any similar event.

19.  Audit Expenses:  cost of audit and inspection, any understated amounts, and any related accounting and legal expenses

  • Due Date:  On demand.
  • You will be required to pay this if an audit reveals that you understated Gross Sales by more than two percent or you fail to submit required reports.

20.  Payment Service Fees:  up to 4% of total charge

  • Due Date:  As incurred.
  • If payment is made to Kidcreate Studio or its affiliates by credit card for any fee required, Kidcreate Studio may charge a service charge of up to four percent of the total charge.

21.  Indemnification:  will vary under circumstances

  • Due Date:  As incurred.
  • You must indemnify and reimburse Kidcreate Studio for any expenses or losses that it or its representatives incur related in any way to your Kidcreate Studio Business or Franchise.

22.  Professional Fees and Expenses:  will vary under circumstances

  • Due Date:  As incurred.
  • You must reimburse Kidcreate Studio for any legal or accounting fees that it incurs as a result of any breach or termination of your Franchise Agreement. You must reimburse Kidcreate Studio if it is required to incur any expenses in enforcing its rights against you under the Franchise Agreement.

23.  Successor Franchise Fee:  10% of then-current Initial Franchise Fee

  • Due Date:  At the time you sign the successor Franchise Agreement.
  • This fee is commonly referred to as a “renewal fee.” Payable if you qualify for a successor Franchise and choose to enter into a successor Franchise Agreement.

24.  Transfer Fee:  50% of then-current Initial Franchise Fee, plus cost of training

  • Due Date:  $1,000 non-refundable deposit at time of transfer application submittal and remaining balance prior to transfer.
  • Payable only in connection with the transfer of your Kidcreate Studio Business, a transfer of ownership of your legal entity, or the Franchise Agreement.

25.  Liquidated Damages:  will vary under the circumstances

  • Due Date:  Within 15 days after termination of the Franchise Agreement.
  • Due only if Kidcreate Studio terminates the Franchise Agreement before the end of the term because of your material breach, or you terminate the Franchise Agreement without legal cause.


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