How are Royalty Fees paid to Alloy?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
was $110,000-$180,000.
ITEM 6 OTHER FEES
| Name of Fee (1) | Amount | Date Due | Remarks |
|---|---|---|---|
| Royalty Fee (2) | 7% of Gross Sales | Payable weekly on Wednesday (unless Wednesday is not a business day, then it is due on the next business day) | Royalty Fees are calculated based on Gross Sales for the previous week ending Sunday. Amounts due will be withdrawn by EFT from your designated bank account. |
| Brand Development Fund Fee | 2% of Gross Sales | Payable weekly at the same time and in the same manner as the weekly Royalty Fee | The Brand Development Fund is described in Item 11 |
| Technology Fee | $220 | Payable weekly at the same time and in the same manner as the weekly Royalty Fee. We have the right to change the billing schedule to bi-weekly. | The Technology Fee is for use of a CRM and POS (point of sale system), Scheduler and the Alloy App and reporting dashboard; Lead Management and Marketing Campaign system and bolt-on applications, website development, SEO, email service, Fit Radio, Learning Management System, ProfitKeeper financial system, support and maintenance. The weekly amount may increase as technology changes, although we do not anticipate that the Technology Fee will not increase by more than 30% annually. |
| Local Marketing | 2-8% of Gross Sales | Recommended to be spent monthly until you are at capacity. | Payable to your local marketing suppliers. Any marketing you wish to use must first be approved by us |
| Advertising Groups/Cooperat ives (3) | 1% of Gross Sales, unless we or the cooperative | As determined by the members | Any amounts you contribute to a local or regional advertising group or |
| Name of Fee (1) | Amount | Date Due | Remarks |
|---|---|---|---|
| members (if a cooperative is formed) approve a higher amount |
Source: Item 6 — OTHER FEES (FDD pages 15–20)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, the Royalty Fee is 7% of Gross Sales. This fee is payable weekly on Wednesday, unless Wednesday is not a business day, in which case it is due on the next business day. Alloy calculates Royalty Fees based on Gross Sales for the previous week, ending on Sunday. Alloy will withdraw the amounts due via Electronic Funds Transfer (EFT) from the franchisee's designated bank account.
Alloy defines "Gross Sales" as the total gross revenue from all products and services sold at or from the Alloy Facility, or through the Franchise Business. This includes various fees such as session fees, membership fees, initiation fees, enrollment fees, processing fees, paid-in-full dues, renewal fees, corporate/third party payer fees, monthly dues, pre-sales revenue, fees for optional services like personal training, fees charged to non-members, and revenue from merchandise and product sales. Sales taxes, use taxes, and other similar taxes added to the sales price and collected from the customer and paid to the appropriate taxing authority are deducted from Gross Sales.
Each week, franchisees must provide Alloy with a report of their Alloy Facility's Gross Sales for the previous week ending Sunday. While Alloy may electronically access the franchisee's computer system to obtain this information, the franchisee is still required to provide the report. Additionally, if any state imposes a sales or other tax on the Royalty Fees, Alloy has the right to collect this tax from the franchisee. Franchisees should be aware of these payment terms and ensure they have sufficient funds in their designated bank account to cover the weekly Royalty Fee payments to avoid any penalties.