Detailed Information on Units Moving and Portable Storage’s Initial Franchise Fee, Royalty Fee + 21 Other Fees (Items 5 and 6, 2022 FDD)
1. Initial Franchise Fee: $55,500 for a Protected Territory consisting of 300,000 people
- You must pay an initial franchise fee (“Initial Franchise Fee”) equal to $55,500 for a Protected Territory consisting of 300,000 people.
- If you enter into a Franchise Agreement for the operation of a Franchised Business in a Protected Territory that encompasses a population of more than 300,000 people, the Initial Franchise Fee will be increased by $18,500 per each additional 100,000 in population.
- The maximum population the franchisor typically offers within a Protected Territory is for 1,200,000 people, which requires a $222,000 Initial Franchise Fee.
- The Initial Franchise Fee is payment, in part, for the franchisor’s expenses in furnishing assistance and services to you and for its costs, including general sales and marketing expenses, training, legal, accounting, and other professional fees.
2. Units Containers and Units Equipment: $517,000 to $700,000
- The franchisor is the only approved supplier for trucks, Containers, Units Moving and Portable Storage Delivery Systems, and other equipment and inventory items such as packing and moving supplies, as well as certain inventory items and signage.
- The franchisor estimates that your estimated additional payments to it prior to opening for Containers and other Units Equipment range from $517,000 to $700,000, based on the number of Containers or other Units Equipment you are required to purchase from the franchisor.
- All initial fees are deemed fully earned upon payment, non-refundable, and must be paid in lump sum.
3. Royalty Fee: 8% of Gross Sales per month
- Due Date: Monthly.
- This fee is payable to the franchisor.
4. National Advertising Fund: 2% of Gross Sales
- Due Date: Monthly.
- National Advertising Fund contributions will be collected in the same manner as the Royalty Fee.
- This fee is payable to the franchisor.
5. Local Advertising: $3,000 to $4,500
- Due Date: Monthly.
- The franchisor must approve all advertising prior to use.
- This fee varies upon the size of the franchise business.
6. Cooperative Advertising: any portion or all of the National Advertising Fund Contribution may be re-designated for Cooperative Advertising
- Due Date: As directed.
- The franchisor may establish a cooperative within your regional marketing area.
- Payable to the Cooperative Advertising escrow account which the franchisor will open.
7. Ongoing Purchases of Containers, Equipment, and Supplies: will vary under the circumstances depending on size of the Protected Territory
💰How Much Franchise Can You Afford? Use Our Free Financial Calculator
🎯Find GOOD Franchises in Your Target Industries That Are STILL Available in Your Area (Free Tool)
- Due Date: Time of purchases.
- You will regularly purchase packing and moving supplies from the franchisor or its pre-approved suppliers.
- Periodically, you may need to replace or increase your inventory of Containers, Units Moving and Portable Storage Delivery System equipment, trucks, trailers, marketing and advertising materials, and other items the franchisor furnishes.
8. Software & POS System: the then-current fee; currently, $200 to $400
- Due Date: Monthly.
- This fee is payable to the franchisor’s approved vendor for use of their software.
9. Audit Expenses: reasonable costs and expenses of audit
- Due Date: Upon demand.
- You will reimburse the franchisor for all the cost of an audit only if the audit shows an understatement in amounts due of at least 3%.
10. Late Fees: 18% per annum or the highest rate allowed by law (whichever is less), plus collection costs
- Due Date: Upon demand.
- Applies to all untimely Royalty Fee payments or National Advertising Fund contributions for revenue received by you directly, and any past due amounts for purchases from the franchisor or its Affiliate. Also applies to any understatement in amounts due revealed by an audit.
- This fee is payable to the franchisor.
11. Supplier or Product Approval: all reasonable costs of evaluation
- Due Date: Time of evaluation.
- You must pay the franchisor for all expenses it incurs in evaluating new suppliers or products you wish to use or purchase that it has not previously approved, regardless of whether it subsequently approves such supplier.
12. Insurance Policies: amount of unpaid premiums, plus the franchisor’s expenses in obtaining coverage for you
- Due Date: Upon demand.
- Payable only if you fail to maintain required insurance coverage and the franchisor elects to obtain coverage for you.
- You must also participate in any captive insurance program designated by the franchisor.
13. Renewal Fee: $1,000
- Due Date: 120 days before expiration of the Franchise Agreement.
14. Transfer Fee: $20,000, as well as any commission, broker, or referral fees or charges incurred
- Due Date: Time of transfer.
- This fee does not apply to any transfer under Section 17.3 of the Franchise Agreement.
- This fee is payable to the franchisor.
- In addition to the transfer fee: (i) if the franchisor engages a third party that acts as a broker, agent, or consultant in connection with the sale or transfer, as a condition of transfer, you must pay the franchisor the greater of: (a) Thirty Thousand Dollars ($30,000.00), or (b) the amount the third party charges the franchisor, including any and all third-party commissions and charges assessed in connection with the sale or transfer; or (2) if the franchisor refers or otherwise places you in communication with the transferee, you must pay the franchisor the greater of (a) Thirty Thousand Dollars ($30,000.00), or (b) actual costs and expenses incurred by the franchisor in connection with referring, identifying, or otherwise placing you in contact with transferee, including any and all lead generation costs.
15. Additional Training: market rates as published in the Manual, plus the franchisor’s expenses and your expenses as well as your employees’ expenses in attending
- Due Date: As invoiced.
- The franchisor conducts an initial training program for your Designated Manager (which is you if you are the Designated Manager), and up to three additional people. The cost of this initial training program is included in the Franchise Fee.
- You pay for additional training if you request it and the franchisor agrees to provide it.
16. Long-Distance Moving: additional service fees paid directly to the franchisor (or its designee) from customers
- Due Date: Paid by customers as invoiced.
- The franchisor has the right to require you to use it (or its designee) for certain Long-Distance Moving services. The franchisor reserves the right to charge its then-current rates.
- The franchisor reserves the right to collect payment directly from customers and remit payments to you for services you perform in connection with the Long-Distance Moving, less fees in the amount the franchisor designates for its (or its designee’s) services.
17. Additional Assistance: market rates as published in the Manual; currently $400 per day, plus the franchisor’s expenses
- Due Date: Time of service.
- The franchisor provides one of its representatives to assist you for approximately three days at the beginning of operations of the Franchised Business.
- You pay the franchisor for the additional assistance if you request it.
18. Ongoing Training: you must pay your expenses as well as your employees’ expenses in attending these programs
- Due Date: Time of program.
- The franchisor does not charge for ongoing training programs, but you must pay your own expenses in attending.
19. System Modifications: you must pay all costs associated with any modifications to the System which the franchisor may specify periodically
- Due Date: As required.
- You may incur costs associated with any System modifications, including new equipment, inventory, software, trademarks, etc.
- These fees are payable to the franchisor or third parties.
20. Indemnification: all costs, including attorneys’ fees
- Due Date: Upon demand.
- You must defend lawsuits at your cost and hold the franchisor harmless against lawsuits arising from your operation of the Franchised Business.
- These fees are payable to third parties.
21. Post-Termination and Post-Expiration Expenses: costs and expenses associated with your ceasing of and de-identification with the business
- Due Date: When incurred.
- Upon termination, expiration, non-renewal, and/or transfer of the Franchised Business for any reason, you must pay for all costs and expenses associated with ceasing operations and de-identifying yourself with the Franchised Business and System.
- These fees are payable to the franchisor or third parties.
22. Legal Expenses: all costs including attorneys’ fees
- Due Date: Upon demand.
- You will reimburse the franchisor for all costs in enforcing obligations if it prevails in a dispute with you.
23. National Conference: then-applicable registration fee or a $2,000 fee for failure to attend
- Due Date: Upon demand.
- You must attend any national convention the franchisor designates and pay the then-applicable registration fee to the franchisor. You will pay for your travel and lodging expenses.
- In the event you fail to attend the National Conference, you will incur a fee of $2,000 payable to the franchisor upon demand.
Leave a Reply