How is the royalty fee calculated for a 360 Painting franchise?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty | 6% of Gross Sales; $150 per week | Tuesday, | Based on the previous week’s |
| minimum | Weekly | Gross Sales. |
Gross Sales. "Gross Sales" means the total of all monies and receipts you derive in connection with the Business. Gross Sales does not include (i) promotional allowances or rebates paid to Franchisee in connection with its purchase of products or supplies; (ii) sales, use, merchants' or other taxes measured on the basis of the gross revenues of the Business imposed by governmental authorities directly on sales or use and collected from customers, if the taxes are added to the selling price of your goods and services and are
in fact paid by you to the appropriate governmental authorities; or (iii) the value of any coupons duly issued and approved by you, or any bona fide discounts or customer refunds approved by us.
We reserve the right to modify the amount, manner of payment and/or timing for payment for all fees payable to us or our affiliates, except that we will not modify the amount of the Royalty Fee or the Market Fund contribution you pay to us during the initial term of your Franchise Agreement.
If any payments to us are taxed (not income tax), the Royalty will be increased so that the net payment to us is the same as without the tax.
Source: Item 6 — OTHER FEES (FDD pages 18–21)
What This Means (2025 FDD)
According to the 2025 360 Painting Franchise Disclosure Document, the royalty fee is calculated as 6% of gross sales, with a minimum of $150 per week. This royalty is due every Tuesday and is based on the previous week's gross sales. Gross Sales are defined as the total of all monies and receipts you derive in connection with the Business, but excludes promotional allowances or rebates, sales, use, merchants' or other taxes measured on the basis of the gross revenues of the Business imposed by governmental authorities directly on sales or use and collected from customers, and the value of any coupons duly issued and approved by you, or any bona fide discounts or customer refunds approved by us.
For a 360 Painting franchisee, this means that each week, they must calculate 6% of their total revenue and ensure it meets the $150 minimum. If 6% of gross sales is less than $150, the franchisee still needs to pay $150. This fee structure is common in franchising, where franchisors collect a percentage of revenue to support the brand and provide ongoing services. The weekly payment schedule requires franchisees to manage their cash flow effectively to meet this obligation.
It is important to note that 360 Painting reserves the right to modify the amount, manner of payment and/or timing for payment for all fees payable to them or their affiliates, but they will not modify the amount of the Royalty Fee during the initial term of the Franchise Agreement. Franchisees should be aware of this provision and understand that while the royalty percentage is fixed for the initial term, other fees could potentially change. Franchisees can find the current amounts, manner of payment and timing for payment of all fees and costs in the Brand Standards Manual.
Additionally, if any payments to 360 Painting are taxed (excluding income tax), the royalty will be increased to ensure that the net payment received by 360 Painting remains the same as if the tax did not exist. This clause protects the franchisor from bearing the burden of any taxes imposed on royalty payments, ensuring they receive the full agreed-upon amount.