Considering a Two Men and a Truck Franchise? Don’t Overlook These 35 Important Franchise Fees

Updated May 23, 2018.

If you are considering a Two Men and a Truck franchise, don’t get blindsided by these 35 important franchise fees (from the initial franchise fee, to the royalty fee, to 33 other fees found in Items 5 and 6 of Two Men and a Truck’s 2018 FDD).

1.  Initial Franchise Fee for Standard Franchise:  $50,000 to $85,000

• The initial franchise fee for a standard franchise is $50,000 for a Marketing Area where Two Men and a Truck has had no prior presence, and is $85,000 for a Marketing Area where Two Men and a Truck has had a prior presence in any portion of the Marketing Area.

• The initial franchise fee grants you the right to operate within a specified Marketing Area that will generally have a population of approximately 420,000 to 600,000, although some pre-designed Marketing Areas will exceed 600,000 in population.

• In some circumstances, Two Men and a Truck may approve a Marketing Area that is not a pre-designed Marketing Area that contains a population of more than 600,000. In those cases, Two Men and a Truck may charge an additional initial franchise fee based on $10,000 for every additional 50,000 population within that area ($10,000 x the actual additional population ÷ 50,000).

2.  Initial Franchise Fee for Mini-Market Franchise:  $30,000

• The initial franchise fee for a mini-market franchise is $30,000. The initial franchise fee grants you the right to operate within a specified Marketing Area that will generally have a population of approximately 100,000 to 200,000.

• Two Men and a Truck is a member of the International Franchise Association and participates in the International Franchise Association’s VetFran Program, which provides a 10% discount on initial franchise fees to veterans of the U.S. Armed Forces who otherwise meet the requirements of the VetFran program.

3.  Franchise Reservation Fee:  $10,000

• If Two Men and a Truck enters into a Preliminary Approval Agreement with you before you sign a Franchise Agreement, you must pay a franchise reservation fee of $10,000 at the time you sign the Preliminary Approval Agreement.

• If you enter into a Franchise Agreement with Two Men and a Truck, the franchise reservation fee will be applied to the initial franchise fee due under the Franchise Agreement.

• If the Preliminary Approval Agreement expires or terminates for any reason other than the signing of a Franchise Agreement, Two Men and a Truck will retain the franchise reservation fee.

4.  Area Development Fee:  initial fees for each of the Marketing Areas you have a right to develop under the Area Development Agreement

• If you become an Area Developer by signing an Area Development Agreement, you pay Two Men and a Truck the initial fees for each of the Marketing Areas you have a right to develop under the Area Development Agreement at the time you sign the Area Development Agreement.

• You must agree to develop at least two franchises under the Area Development Agreement.

5.  Royalty Fee:  6% of all Gross Sales

• Due Date:  The 15th day of each month or by 5:00 p.m. of the first business day following the 15th, if the 15th is not a business day; payments made by automated clearing house (ACH) transfers.

• Gross Sales include all revenue from any source as defined in the Franchise Agreement or otherwise by Two Men and a Truck.

6.  Contributions to Advertising Fund:  1% of all Gross Sales

• Due Date:  The 15th day of each month or by 5:00 p.m. of the first business day following the 15th, if the 15th is not a business day; payments made by ACH transfers.

• The Advertising Fund is administered and controlled by Two Men and a Truck.

7.  Monthly Technology and Support Fee (standard franchise):  1% of Gross Sales with a minimum payment of $1,200 per month

• Due Date:  The 15th day of each month or by 5:00 p.m. of the first business day following the 15th, if the 15th is not a business day; payments made by ACH transfers.

• Two Men and a Truck may change this fee based on the amount required to develop and support the operating system and other programs.

8.  Monthly Technology and Support Fee (mini-market franchise):  2% of Gross Sales with no minimum

• Due Date:  The 15th day of each month or by 5:00 p.m. of the first business day following the 15th, if the 15th is not a business day; payments made by ACH transfers.

• Two Men and a Truck may change this fee based on the amount required to develop and support the operating system and other programs.

9.  Fees for Customer Relationship Center (CRC) Services – Standard Franchise:  $500 per month for the first 12 months for new franchises only, otherwise $750 per month, plus a $35 per transaction fee for each completed move originating from the CRC

• Due Date:  Paid by ACH transfers on the last business day of the month in which they are incurred.

• These services are required for all new franchisees and are being phased-in as a required service for all existing franchisees through 2019.

10.  Fees for Customer Relationship Center (CRC) Services – Mini-Market Franchise:  $500 per month, plus a $35 per transaction fee for each completed move originating from the CRC for the first 12 months (and after if you employ a CSR), then $2,000 per month with no transaction fee if you do not employ a CSR

• Due Date:  Paid by ACH transfers on the last business day of the month in which they are incurred.

• These services are required for all new franchisees and are being phased-in as a required service for all existing franchisees through 2019.

• A CSR is a customer service representative.

11.  Records and Bookkeeping Fees:  $200 to $500 per month; late fee of $100 for failure to timely submit data

• Due Date:  Paid by ACH transfers on the last business day of the month in which they are incurred.

• These services are optional for standard franchises and required for mini-market franchises.

12.  Risk Management and Safety Services Fees:  $2,000 to $3,000 per year

• Due Date:  Paid by ACH transfers on the last business day of the month in which they are incurred.

• Two Men and a Truck may require you to obtain these services from it or a Designated Supplier.

13.  Local Advertising Expenditures (standard franchise):  for each calendar year, an average of $1,500 per month for new franchises until operated for a full calendar year, and otherwise 2% of Gross Sales of the previous calendar year

• Due Date:  As incurred.

• You must spend the required minimum amounts on local advertising. Two Men and a Truck may increase the percentage of Gross Sales to 3% in some circumstances.

14.  Local Advertising Expenditures (mini-market franchise):  for each calendar year, the greater of 2% of Gross Sales or $1,000 per month

• Due Date:  As incurred.

• You must spend the required minimum amounts on local advertising.

• Two Men and a Truck may require you to spend some or all of these amounts on advertising methods specified by it.

15.  Advertising Cooperative:  as assessed by cooperative

• Due Date:  As assessed.

• Cooperatives can impose assessments for advertising of up to 1% of Gross Sales.

16.  Miscellaneous Fees and Charges:  as assessed for goods or services provided ($30 to $300)

• Due Date:  Any charges will be paid by ACH transfers on the last business day of the month in which they are incurred.

• Includes payments for behavioral assessments, career ads, and technical support services purchased from Two Men and a Truck.

17.  NSF Fees and Interest:  NSF fee of at least $100 and interest of 2% per month or maximum rate allowed by law

• Due Date:  As incurred.

• An NSF fee must be paid if you have insufficient funds to cover an electronic transfer and interest must be paid on all overdue amounts.

18.  Audit Expenses:  cost of audit

• Due Date:  On receipt of Two Men and a Truck’s invoice.

• Two Men and a Truck reserves the right to require you to pay it or its representatives or third-party agents for the reasonable expenses of an audit, inspection, and investigation.

19.  Fees for Assistance in Commencement and Operation of Franchise:  $500 to $1,200 per day, plus travel and living expenses of training personnel

• Due Date:  On receipt of Two Men and a Truck’s invoice.

• Two Men and a Truck will provide reasonable assistance to you in the commencement and operation of your franchise.

• Two Men and a Truck may charge a reasonable per diem fee plus travel and living expenses of its staff or third-party vendors providing this assistance.

20.  Indemnification:  will vary under circumstances

• Due Date:  As incurred.

• You must reimburse Two Men and a Truck if it incurs liability from the operation of your franchise.

21.  Attorney’s Fees and Costs:  will vary under circumstances

• Due Date:  As incurred.

• You must pay Two Men and a Truck’s costs if it must take action to enforce your obligations to it.

22.  Reimbursement for the Cost of Insurance:  $25,000 to $43,000 annually

• Due Date:  As incurred.

• If you fail to obtain or maintain any of the required insurances, Two Men and a Truck may obtain that insurance on your behalf and you must reimburse it for the cost.

• Payments relating to Participation in Captive Insurance Program.

• Paid by ACH transfers on the last business day of the month in which they are incurred.

23.  Tax Reimbursement Fees:  will vary with circumstance

• Due Date:  As incurred.

• These fees will be paid to Two Men and a Truck to reimburse it for sales, use, personal property, and other taxes it pays.

24.  Renewal Fee:  10% of the franchise fee charged to new franchisees at the time of renewal (the fee is 20% if you do not timely renew)

• Due Date:  Paid by ACH on the date of renewal.

• This fee must be paid if you renew your Franchise Agreement.

25.  Fee for Adding a Person as a Franchisee or as a Principal of the Franchisee:  12½% of the franchise fee charged to new franchisees at time of addition for each person added

• Due Date:  Before person is added and before training has started for that person.

• This fee must be paid for each person you add as a franchisee or principal of your franchise.

26.  Marketing Area Division Fee:  25% of the franchise fee charged to new franchisees at the time of transfer

• Due Date:  Before transfer and before training of proposed transferee.

• This fee must be paid if you transfer your franchise or divide your Marketing Area.

27.  Fees for Additional Training and Meetings:  $200 to $1,075 for registration fees for meetings; $500 to $1,200 per person per day, plus travel and living expenses of training personnel for additional training

• Due Date:  Before additional training.

• Two Men and a Truck may charge fees, including a reasonable per diem fee or registration fees for attending additional training or meetings.

28.  Fees for Administering National Accounts:  5% to 10% of each payment you receive from the National Account

• Due Date:  On receipt of payment from the National Account.

• Two Men and a Truck does not currently charge any fees for administering National Accounts.

29.  Fees for Administering National Programs – Value Flex:  1% of value of materials being moved and 5% to 6% of the revenue from the move

• Due Date:  On receipt of payment from the customer.

• Two Men and a Truck’s Value Flex Program is currently the only National Program.

• The 1% of value charge is to cover potential damages. The 5% to 6% of revenue charge is for administrative expenses and capital expenditures.

30.  Value Flex Program –  Container Lease Payments:  one-time payment of $4,900 to $6,600 for each container

• Due Date:  On signing a Value Flex Program Hub Addendum.

• If you participate in this Program, you must pay this fee for each container you acquire from Two Men and a Truck.

31.  Vendor Product Testing Fee:  actual out-of-pocket cost, plus $125 per hour for evaluation

• Due Date:  On receipt of Two Men and a Truck’s invoice.

32.  Liquidated Damages:  $100 to $4,000

• Due Date:  Any charges will be paid by ACH transfers on the 5th business day following the invoice date.

33.  Indemnification for Amounts Paid to Resolve Franchisee’s Disputes:  varies under the circumstances

• Due Date:  On receipt of Two Men and a Truck’s invoice.

34.  Fees and Third Party Software License Fees:  $1,500 to $6,600 per year

• Due Date:  As incurred.

• In order to use Two Men and a Truck’s Automation Systems, you must have access to the Internet. Also, you must acquire some third-party software for use in your business (for example, bookkeeping software).

35.  Holdback Amount for Customer Claims:  an amount determined by Two Men and a Truck based on your customer damage history for previous two years and any known current damage issues

• Due Date:  Paid by ACH five days before expiration or termination.

• You must pay this amount if your franchise is expiring or terminating.

• This amount will be held by Two Men and a Truck for six months and used to resolve any customer disputes. The balance will be returned to you.