For Anago franchisees, what is the minimum royalty fee during the first 12 months of operation?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
service is provided by You directly or by Your |
| Type of Fee1 | Amount | Due Date2 | Remarks |
|---|---|---|---|
| operation, no minimum b) from the 13th - 24th months of operation, the minimum Royalty Fee is $1,500 per month c) beginning the th month of 24 operation until the termination of this agreement, the monthly minimum Royalty Fee shall increase each 12 months by $1,500 over the prior minimum amount. Any Successor Agreement shall contain a provision for the minimum monthly royalty paid to be no less than the average monthly ro |
Source: Item 6 — OTHER FEES (FDD pages 12–19)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, the minimum royalty fee for franchisees during the first 12 months of operation is structured with no minimum. However, starting from the 13th month through the 24th month, the minimum royalty fee increases to $1,500 per month.
This tiered royalty structure means that Anago franchisees have a grace period during their initial year, allowing them to focus on establishing their business without the pressure of meeting a minimum royalty payment. This can be particularly beneficial for new franchisees who may need time to build their client base and generate sufficient revenue.
After the first year, the minimum royalty fee of $1,500 per month comes into effect, and it further escalates by $1,500 every 12 months thereafter. This progressive increase in the minimum royalty fee should be carefully considered by prospective franchisees, as it directly impacts their financial planning and profitability projections. Franchisees need to ensure their revenue growth can keep pace with these increasing minimums to maintain a healthy profit margin.