How Much Does It Cost to Own a Cold Stone

Updated July 13, 2021.

If you are considering a Cold Stone Creamery franchise, don't get blindsided by these 34 important franchise fees (from the initial franchise fee, to the royalty fee, to 32 other fees found in Items 5 and 6 of Cold Stone Creamery's 2021 FDD).

1.  Initial Franchise Fee: $15,000 to $27,000 for a traditional store; $10,000 to $20,000 for a non-traditional store

• The initial franchise fee ("Initial Franchise Fee") for your first Cold Stone Creamery traditional restaurant is $27,000. The Initial Franchise Fee is reduced for your second and each subsequent traditional restaurant to $15,000.

• The Initial Franchise Fee for your non-traditional Cold Stone Creamery restaurant location ranges from $10,000 to $20,000 for each restaurant.

• If you are currently an active or active reserve member of the U.S. Armed Forces, have been honorably discharged from the U.S. Armed Forces ("Eligible Military"), or are a 501(c)(3) organization ("501(c)(3)"), you will receive a 20% discount on the Initial Franchise Fee.

2.  Grand Opening Marketing:  $10,000 for a traditional store and $5,000 for a non-traditional store

• Due Date:  Earlier of prior to execution of a lease or prior to construction of premise.

3.  Lease Guarantee Fee (optional):  10% of the total amount guaranteed, up to a maximum payment of $10,000 (if applicable)

• Due Date:  Signing of the Lease Agreement (if applicable).

4.  Lease Review Fee (optional):  $0 to $2,500

• Due Date:  Signing of the Franchise Agreement.

5.  Equipment, Interior and Exterior Signage, Menu Boards, Millwork, and/or Smallwares:  $5,500 to $10,000

• Due Date:  When invoiced.

6.  Royalty Fee and Surcharge:  6% of Gross Sales, plus a maximum surcharge of $10 per week

• Due Date:  Withdrawn electronically from your Depository Account weekly.

• "Gross Sales" include all revenue from your restaurant excluding sales tax and authorized refunds, credits, and allowances.

7.  Advertising Fees:  3% of weekly Gross Sales

• Due Date:  Same as Royalty Fee.

• The Advertising Fees are deposited as follows: 2% to the National Fund and 1% to the Regional Fund for your Cooperative or your store.

8.  Additional Persons Training Fee:  $1,750 per person ($1,000 per person ($500/40 hour week) for the In-Store portion of the Training Program, and $750 per person for the New Owner Training portion of the Training Program)

• Due Date:  2 weeks prior to beginning of training.

• The training of two individuals is included in the Initial Franchise Fee. The Additional Persons Training Fee is for any additional persons who attend the Training Program.

9.  Additional Training Fee:  $300 per person per day

• Due Date:  Prior to attendance.

• Payable if you request additional training after attending the Training Program.

10.  Annual Meeting Registration Fee:  up to $1,000, plus incidental costs to attend

• Due Date:  60-90 days prior to the Meeting.

• Cold Stone Creamery will debit your Depository Account for this fee, which is non-refundable. This fee is charged to all franchisees whether or not they attend the Meeting.

11.  Depository Account:  $3,000 (must be replenished on a regular basis)

• Due Date:  At signing of Franchise Agreement.

12.  Charitable Contributions:  to be determined by Cold Stone Creamery

• Due Date: As determined by Cold Stone Creamery.

13.  Data Fees:  up to $75 per month (subject to reasonable annual and/or service enhancement increases)

• Due Date:  Same as Royalty Fee.

• Begins immediately after you open your restaurant.

14.  POS Help Desk Phone Support Maintenance Contract Fee:  up to $55 per month

• Due Date:  Last Thursday of each month.

• Cold Stone Creamery will debit your Depository Account for this fee.

15.  Gift Card Redemption Fee:  11% of the amount of the gift card redemption

• Due Date:  On or about the 25th day of each month.

• Fee is charged by Cold Stone Creamery and collected by a third party on Cold Stone Creamery's behalf.

16.  Renewal Franchise Fee – Traditional and Non-Traditional Location: 50% of the then-current Initial Franchise Fee

• Due Date:  When new Franchise Agreement is signed at renewal.

• Applicable if you are renewing your Franchise Agreement.

• Renewal term is five years.

17.  Transfer Franchise Fee – Traditional Location:  $17,500

• Due Date:  Prior to consummation of transfer.

• Payable if you are purchasing your Franchised Business as a result of a full transfer. A full transfer is including, but not limited to, a transfer of 50% or more ownership or control.

18.  Transfer Franchise Fee – Non-Traditional Restaurant: $5,000

• Due Date:  Prior to consummation of transfer.

• Payable if you are purchasing your Franchised Business as a result of a full transfer. A full transfer is including, but not
  limited to, a transfer of 50% or more ownership or control

19.  Relocation Fee:  $500

• Due Date:  At signing of relocation amendment to Franchise Agreement.

• Payable if Cold Stone Creamery approves the relocation of your store.

20.  Non-Participation Fee:  $100 per day if you fail or refuse to participate in any required national, local, regional, seasonal, promotional, or other program, initiative, and campaign or in any new or modified product or service test or offering

• Due Date:  Upon failing or refusing to participate.

• Payable to Cold Stone Creamery.

21.  Document Administration Fee:  $500

• Due Date:  Lump sum.

• Applicable if an amendment must be prepared, including for an affiliate transfer.

22.  Default Interest:  $50, plus interest at 1-1/2% per month or maximum legal rate, if less ("Default Rate")

• Due Date:  Payable upon assessment.

• Payable on all overdue amounts.

23.  Document Late Charge:  $100 per week or partial week

• Due Date:  Payable upon assessment.

• Payable if any required financial statement, report, or other document is delinquent.

24.  Draft Draw Charge: $100 per day

• Due Date:  As incurred.

• Payable to Cold Stone Creamery.

25.  Late Charge:  5% of the unpaid amount or $100, whichever is greater, on royalties, advertising payments, and other amounts unpaid within 10 days

• Due Date:  As incurred.

• Payable to Cold Stone Creamery.

26.  Sublease Late Charge:  5% of the late or unpaid amount, plus any late charges and interest incurred under the Master Lease as a result of the late payment (where applicable)

• Due Date:  As incurred.

• Payable to Cold Stone Creamery's affiliate if you are subleasing your restaurant space from Cold Stone Creamery's affiliate.

27.  Collection Costs:  all collection costs, including reasonable attorneys' fees

• Due Date:  Payable upon assessment.

• Payable only if Cold Stone Creamery is required to retain an attorney or collection agency to collect delinquent payments from you.

• Cold Stone Creamery will also collect as damages any attorneys' fees and costs incurred by it in defending claims that arise due to your actions as a Cold Stone Creamery franchisee.

28.  Non-Sufficient Funds Fee:  $50 for each electronic funds transfer returned for non-sufficient funds; $25 for each check or draft returned for non-sufficient funds

• Due Date:  Payable upon assessment.

• Payable only if your electronic funds transfer from your Depository Account or any check you remit to Cold Stone Creamery is returned for non-sufficient funds.

29.  Audit:  cost of audit, plus interest at Default Rate on underpayments or the maximum rate permissible by law

• Due Date:  Payable upon assessment.

• Payable only if audit is caused by your failure to furnish reports or if audit reveals an understatement of fees or assessment of 5% or more.

30.  Early Termination Damages:  the average monthly Royalty and Advertising Fees paid for any consecutive 12-month period within the preceding 48-month period multiplied by the number of months remaining in the term of the Franchise Agreement, and the product is divided by 2

• Due Date:  30 days prior to the early closing of the restaurant.

• You must provide Cold Stone Creamery with 90 days prior written notice of the termination of your Franchise Agreement.

31.  Attorneys' Fees and Costs:  will vary under the circumstances

• Due Date:  As incurred.

• Payable to Cold Stone Creamery.

32.  Indemnification of Cold Stone Creamery and/or Its Affiliates for Damages Suffered or Incurred for Your Actions or Omissions, Including Amounts Paid on Your Behalf or to Cure Your Breaches Under the Franchise Agreement:  will vary under the circumstances

• Due Date:  As incurred.

• Payable to Cold Stone Creamery.

33.  Liquidated Damages for Breach of Non-Compete Obligations Under the Franchise Agreement: will vary under the circumstances

• Due Date:  As incurred.

• Payable to Cold Stone Creamery.

34.  Management Fee:  6% of the Franchised Business's Gross Sales (in addition to the Royalty Fee and Advertising Fee), plus Cold Stone Creamery's direct out-of-pocket costs and expenses

• Due Date:  Payable with Royalty and Advertising Fee.

• If Cold Stone Creamery assumes the management of your Franchised Business for any period of time.

How Much Does It Cost to Own a Cold Stone

Source: https://www.franchisechatter.com/2019/10/19/considering-a-cold-stone-creamery-franchise-dont-overlook-these-38-important-franchise-fees/

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