How are Net Revenues calculated for Royalty Fee reconciliation purposes if a Bambu Franchisee relocates and closes their shoppe temporarily?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
dit after the January 15th reconciliation, Bambu will apply the overpayments to future monthly Royalty Fees until the overpayment is fully applied. If, during a relocation in accordance with Article 11, Franchisee closes its Bambū shoppe prior to opening at its new Franchised Location, for purposes of reconciling the Royalty Fees under this Section 12.3, Franchisee shall be deemed to have gene
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, if a franchisee closes their shoppe during a relocation, Net Revenues are calculated differently for royalty fee reconciliation. Instead of using actual sales data during the closure, the franchisee is deemed to have generated Net Revenues on a monthly basis equal to $800 divided by 3.5 percent, prorated for any partial months of closure. This calculation is used specifically for reconciling royalty fees during the period the shoppe is closed for relocation.
In practical terms, this means that even if the Bambu shoppe isn't generating revenue during the relocation, the franchisee will still owe royalty fees based on this imputed revenue calculation. The royalty fee is normally 3.5% of Net Revenues, and the monthly royalty fee is $800. This imputed revenue ensures that Bambu continues to receive royalty payments during the transition period.
For a prospective franchisee, this highlights the importance of carefully planning any relocation to minimize closure time. Even a short closure can result in unexpected royalty fee obligations based on this imputed revenue calculation. Franchisees should factor this ongoing royalty obligation into their financial planning when considering a relocation.
It's also important to note that while the royalty fee continues during the closure period, Bambu will waive the Marketing and Technology Fee until the relocated shoppe reopens. This provides some financial relief to the franchisee during the relocation process, offsetting the royalty fee obligation to some extent.