How often are 1 800 Packouts franchisees required to pay royalties?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
on limit. Should the population exceed 1,250,000 people during the term of your agreement the population fee will increase at the same rate of $500 per each 250,000 people detailed in the table above (i.e., 1,000,001 to 1,250,000 would be $2,500 per month). Your NROP Fee is owed regardless if whether you enroll in all, some, or none of the NROP programs.
D. ROYALTY FEES
You must pay us a monthly royalty fee (the "Royalty Fee") equal to 7% of the monthly Gross Sales of the Franchised Business. "Gross Sales" means all revenue of the Franchised Business, including all sales of products and services to customers of the Franchised Business, but excluding excise, sales and use taxes, gross receipts taxes or similar taxes you pay based on revenues, if those taxes are separately stated when the customer is charged, and also excluding bona fide refunds actually paid to customers. If we reasonably determine any fee based upon your Gross Sales is not permissible under applicable law, then we and you will negotiate an alternative basis for payment and, if we and you cannot agree, we or you may terminate this Agreement, but all of your post-termination obligations under Section 16 (Obligations Upon Termination or Expiration of the Agreement) shall apply upon any such termination.
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to the 2025 1 800 Packouts Franchise Disclosure Document, franchisees must pay a monthly royalty fee, which is 7% of the monthly Gross Sales of the Franchised Business. These Royalty Fees, along with the Marketing Fee, are due via Electronic Funds Transfer (EFT) or another method prescribed by 1 800 Packouts.
The payment is due upon the earlier of when payment is received from the client or 180 days following the initial service date with the client. Franchisees are required to notify 1 800 Packouts within three days of receiving any payment by uploading a copy of the check into the tracking system. Failure to provide timely notification may result in interest or penalties.
1 800 Packouts reserves the right to collect these fees on a weekly basis if a franchisee is delinquent in any Royalty Fees or Marketing Fee payments three times in any 12-month period. This provision serves as an incentive for franchisees to maintain timely payments and adhere to the payment schedule outlined in the franchise agreement.