Understanding the PJ’s Coffee Franchise Disclosure Document (FDD)

If you’re considering joining the PJ’s Coffee family as a franchisee, you’ve likely come across the term “Franchise Disclosure Document” (FDD). This document is crucial as it provides essential information about any franchise opportunity, helping you make a well-informed decision about your future business venture. Here’s everything you need to know about the FDD and how to evaluate.

What is the Purpose of the FDD?

Before franchisors award a new franchisee, they are required to send that individual a Franchise Disclosure Document — a legal document regulated by the Federal Trade Commission — at least 14 days in advance. The document acts as a comprehensive guide for potential franchisees and provides information about the franchisor, the franchise system, the costs and more.

The FDD must be updated annually to reflect the previous year’s data and offer transparency, ensuring that candidates have access to key details about the franchise system before making a commitment.

How to Evaluate an FDD

As a franchisee, you’re making a significant financial investment in your business. The FDD helps you understand where your investment goes, from initial franchise fees to ongoing royalties and other expenditures. While it’s your business and your financial commitment, PJ’s Coffee stands by you with comprehensive support and guidance every step of the way.

Some of the most frequently reviewed items by franchisees include:

• Item 1 - The Franchisor, Parents, Predecessors and Affiliates: A general overview of the franchise opportunity’s background is provided. For PJ’s Coffee, this section explains our experience in the coffee industry along with Item 2 - Business Experience, which details key members within our management team and their expertise.
• Item 7 - Estimated Initial Investment: Types and amount of expenditures that may be incurred in the initial stage of operating a franchised business – from construction to the opening of the business and other necessary operational items – can be found in this section. A clear breakdown of the costs involved in starting your franchise ensures transparency regarding financial expectations from the beginning.
• Item 9 - Franchise Obligations: This portion often references agreements and/or relevant contracts and gives potential franchisees an overview of their principal obligations in operating a franchise unit should they agree to sign on.
• Item 19 - Financial Performance Representations: Candidates are given an idea of the actual or potential sales, income, and gross or net profits they can achieve if they enter the franchise system. Given that the data provided is based on existing franchisees’ financial performance, this section is crucial to evaluate for your potential return on investment.

Our FDD also covers intellectual property rights, ensuring that you understand how to use our brand, trademarks, and proprietary systems. Learning from our experience means benefiting from our proven business model and avoiding common pitfalls.

The FDD is a critical opportunity for prospects to see how a business views its relationship with existing franchisees. With PJ’s Coffee, we break down the support and resources we provide, as well as your responsibilities as a franchise owner. This clarity is crucial for establishing a mutually beneficial partnership built on trust and collaboration.

PJ’s Franchise Discovery Process

At PJ’s Coffee, our Franchise Discovery Process is designed to guide you through every step of understanding and evaluating the franchise model. Your franchise executive will not only aid you in thoroughly understanding the FDD but will also take you through a series of agenda-specific calls on real estate, training, marketing, operations and more. Sharing the FDD is not just a legal requirement — it’s a fundamental aspect of our commitment to transparency and partnership. PJ’s Coffee believes in empowering franchisees with the knowledge they need to succeed – both in the short- and long-term.

We encourage open communication and provide ample opportunities for you to ask questions and clarify any aspects of the document. Our goal is to ensure that you feel confident and informed as you consider joining our franchise family.

We invite you to explore our FDD, ask questions and discover how PJ’s Coffee can be the ideal partner for your entrepreneurial journey and a roadmap to success today.