How will the Royalty, including the Minimum Monthly Royalty, be collected and credited against royalty due for an Aplus franchise?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
The Royalty, including the Minimum Monthly Royalty shall be collected in advance and will be credited against royalty due as calculated on the total Gross Sales at the end of each month. The Rent and Royalty (which includes the Minimum Monthly Royalty) are due and payable in advance, without demand or notice: (i) where a monthly installment is required, on or before the tenth (10th) day of the month; or (ii) where a semi-monthly installment is required, on or before the tenth (10th) day of the month and on or before the twenty-fifth (25th) day of the month. Rent and fees shall be prorated on a daily basis for periods of less than one (1) month.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, the royalty, including the Minimum Monthly Royalty, is collected in advance. This advance payment will then be credited against the total royalty due, which is calculated based on the total Gross Sales at the end of each month.
For Aplus franchisees, this means that a portion of the royalty fees are paid upfront. This system ensures that Aplus receives a consistent cash flow throughout the month, while the franchisee's actual royalty obligation is reconciled at the end of the month based on their sales performance.
The FDD also specifies that rent and royalty payments (including the Minimum Monthly Royalty) are due in advance, either monthly or semi-monthly. Monthly installments are due on or before the 10th day of the month, while semi-monthly installments are due on or before the 10th and 25th days of the month. For periods less than one month, these rent and fees are prorated on a daily basis.