Updated February 24, 2020.

If you are considering a Wine & Design franchise, don’t get blindsided by these 23 important franchise fees (from the initial franchise fee, to the royalty fee, to 21 other fees found in Items 5 and 6 of Wine & Design’s 2019 FDD).

1.  Initial Franchise Fee:  $25,000

• The initial franchise fee for a Wine & Design franchise is $25,000, and is due when you sign the Franchise Agreement.

• Wine & Design may offer discounts to its existing franchisees for each additional franchise that they wish to open. The current discount is 50% off of the initial franchise fee, which is only available if you are a then-existing Wine & Design franchisee that: (a) has an operating studio that has been continuously open for at least 12 months, (b) has been in full compliance with your Franchise Agreement for at least 12 consecutive months, (c) meets Wine & Design’s qualifications for expansion as set forth in its operations manual, and (d) the new franchise is for a studio outside of the exclusive or protected area granted to you in your previous franchise.

• If you purchase a Wine & Design franchise to be opened in a state where Wine & Design does not have an operating franchise and the purchase is your first Wine & Design franchise, Wine & Design will discount the initial franchise fee by 10%.

• If you are a U.S. veteran and the purchase is your first Wine & Design franchise, Wine & Design will discount the initial franchise fee by 15%.

2.  Development Fee:  $12,500 for each Studio developed under the Area Development Agreement

• The development fee for each Studio developed under the Area Development Agreement is $12,500; so for the minimum of 2 Studios, the development fee is $25,000 which must be paid when you sign the Area Development Agreement.

• In addition, when you sign the Area Development Agreement, you must pay Wine & Design the remaining balance of the initial franchise fee of $12,500 for the first Studio under the Area Development Agreement. The remainder of the initial franchise fee of $12,500 for the second Studio (and each additional Studio) is due when you sign the Franchise Agreement for that Studio.

3.  Royalty Fees:  6% of monthly gross sales

• Due Date:  5th day of each month.

• No royalties are paid until the franchise begins operations.

• The royalties will be electronically drafted from your bank account.

4.  Local or Regional Cooperative Fees:  currently, not collected

• Due Date:  When designated by cooperative.

• This fee is not paid to Wine & Design.

• Cooperative payments are determined by majority vote of the cooperative members.

5.  Advertising Fees and Expenses:  2% of monthly gross sales

• Due Date:  5th day of each month.

• Can be raised up to 4% of gross sales.

6.  Renewal Fee:  $2,500

• Due Date:  Upon signing a new Franchise Agreement.

7.  Transfer Fee:  $7,500

• Due Date:  When Wine & Design approves franchise transfer.

8.  Audit Fee:  cost of audit, reasonable legal and accounting fees, plus the amount of any deficiency and interest

• Due Date:  Immediately.

• If there is a 3% or more understatement, you must reimburse Wine & Design for these costs. Wine & Design pays for the audit if underpayment is 3% or less.

9.  Interest Charges:  18% or highest lawful rate if lower

• Due Date:  Immediately if payments not made when due.

• This charge is in addition to other remedies such as late payment fees.

10.  Initial Training:  initial franchise fee includes pre-opening training for all people trained in a single session

• Due Date:  Upon signing Franchise Agreement. For pre-opening, this is included in the initial franchise fee. For extra people not attending pre-opening training, payment is due before training class commences.

• The business must be managed by a person approved by Wine & Design, who has completed to Wine & Design’s satisfaction, or based on experience been relieved of, its training program.

• You pay lodging, transportation, and food expenses incurred by persons attending training.

• All of your staff who Wine & Design requires to be trained must attend the same training session.

11.  Remedial Training:  $500 per day; limited to 3 days of training

• Due Date:  Upon 30 days’ notice to you.

• Wine & Design may require you to attend remedial training in such cases where it determines that you are not operating your franchised business in accordance with its system standards.

12.  Additional Training (for extra people on outset at franchisee’s option or later if desired at franchisee’s option):  standard rate of $250 per person per day, plus your out-of-pocket expenses for travel and lodging. A day of training generally consists of 8 hours of training. Travel costs will include reimbursement for mileage at the then-current IRS published rate.

• Due Date:  30-day notice of additional training with payment due before training class begins.

• There is no charge to franchisee for additional training which Wine & Design requires.

13.  Additional Artist Training:  standard rate of $500 per day, plus out-of-pocket expenses for travel and lodging. A day of training generally consists of 8 hours of training. Travel costs will include reimbursement for mileage at the then-current IRS published rate. The training will be for a maximum of 2 days.

• Due Date:  30-day notice of additional training with payment due before training class begins.

14.  New Supplier/Product Evaluation Fee:  all fees and costs

• Due Date:  On demand.

• If requested by you, you will pay all fees and costs incurred by Wine & Design to obtain the necessary information to evaluate suppliers prior to giving approval for new suppliers and products.

15.  Survey Fee:  $140 per visit

• Due Date:  Upon conclusion of follow-up survey.

• If Wine & Design requires a customer survey be taken of your Studio, you shall pay Wine & Design the cost of such survey.

16.  Indemnification & Hold Harmless:  if any, will depend on unknown factors

• Due Date:  Defense cost when suit occurs. Indemnification when payment required.

• You agree to defend, indemnify, and hold Wine & Design harmless should it be sued as a result of something you do or fail to do.

17.  Attorney’s Fees and Costs, and Arbitration:  depends on what Wine & Design spends

• Due Date:  When court or arbitrator orders, if Wine & Design wins.

18.  Insurance Premium Reimbursement:  varies according to plan and provider

• Due Date:  Reimbursement to Wine & Design due immediately on notice.

• If you do not purchase insurance, Wine & Design can purchase it and you must reimburse Wine & Design.

19.  Enforcement Costs:  will vary

• Due Date:  As incurred.

• You must pay Wine & Design’s costs of enforcement (including attorneys’ fees and costs) if you do not comply with the Franchise Agreement.

• Wine & Design will collect reimbursement from you by EFT for their fees.

20.  Enforcement Fines:  $1,000 or royalty increase of 1% for up to one year

• Due Date:  As incurred.

21.  Insufficient Funds Fee:  $50, plus any fee charged to Wine & Design for uncollected funds, or the maximum legal rate allowed by law

• Due Date:  Upon notice.

22.  Annual Franchise Conference:  registration fee will vary; plus out-of-pocket expenses for travel, food, and lodging while attending, which you pay to third parties

• Due Date:  As incurred.

• If you fail to attend the annual franchise conference, Wine & Design will either raise your royalties by 1% for the balance of the calendar year, or charge you $1,000, whichever is greater.

23.  Liquidated Damages:  payment of future royalties based on the last 12 months of business for the greater of 2 years or the number of years you have left on your Franchise Agreement

• Due Date:  Upon notice by Wine & Design.

• Resulting from termination of your franchise for other than resale or contract expiration.