BIRMINGHAM, AL—Vimana Franchise Systems LLC is restructuring its terms by creating an offering that the company says is designed to drive system growth on a larger scale. New deal terms for franchises include no initial fees, agreements with annual windows and no fees for the first 90 days (and 4% thereafter).
“2017 is a major transitioning year for Vimana, as we continually strive to meet the changing needs of our customers,” said Steve Belmonte, Vimana CEO and co-founder. “There are enormous changes taking places in the franchise landscape; in fact, it’s staggering. The biggest move for Vimana this year was adding a mega-effective infrastructure to create more reservations for anyone joining our system. Then, we looked at our retention rate; it’s at 96%. Since the day Vimana was conceived, people signing with our system who had an expiring contract or a window to renew stayed with Vimana.”
“If we say we are franchise friendly, then we need to be franchise friendly—and that means getting rid of the $3,000 application fee, as well as the $14,000 initial fee,” Belmonte continued. “Furthermore, we know that the first three months are always tough on a new property. They have signage to pay for and other expenses, so during that first three months, we decided not to charge any marketing or royalty fees whatsoever.”
Vimana’s new advertising campaign, which will hit the industry trades by the end of May and early June, will reflect these new deal terms. Finally, Belmonte said Vimana’s new deal terms are designed to remove any favoritism between franchisors and franchisees, noting that franchising can be somewhat unfair. For instance, he said, sometimes an owner with several properties or who has a prior relationship with a franchisor gets a sweeter deal than someone entering a system for the first time. “By restructuring our deal terms, Vimana is leveling the playing field for everyone,” Belmonte said.