What were the royalty fees for the Bambu franchise in 2023?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
to Franchisee after it is paid, unless otherwise specifically set forth in this Agreement.
12. CONTINUING FEES AND PAYMENTS
- 12.1 Royalty Fee. Franchisee shall pay to Bambu, in addition to all other fees due hereunder, a continuing royalty fee ("Royalty Fee") equal to 3½% of Franchisee's Net Revenues, payable as described in Section 12.3. Franchisee acknowledges that Bambu is entering into this Agreement with the expectation that it will receive the Royalty Fee over the full term of this Agreement.
- 12.2 Marketing and Technology Fee. Franchisee shall contribute to a marketing and technology fund established by Bambu ("Marketing and Technology Fund") a fee in the amount set forth in Attachment I ("Marketing and Technology Fee"). The Marketing and Technology Fee is subject to annual increases on 90 days' written notice to Franchisee.
12.3 Payment Terms.
a. The Royalty Fee shall be payable $800 per month due on the first day of each month starting in the month following the month in which Franchisee commences operations of its Bambū shoppe. On or before July 15th of each calendar year, Bambu will reconcile the Royalty Fee due based on Franchisee's actual Net Revenues generated between January 1st and June 30th minus the monthly payments made for those months, with any additional amounts due and payable no later than five days after completion of the reconciliation. On or before January 15th of each year, Bambu will reconcile the Royalty Fee due for the prior calendar year based on Franchisee's actual Net Revenues generated by Franchisee's Bambū shoppe in the prior calendar year minus all Royalty Fee amounts previously paid related to Franchisee's prior year operations, with any additional amounts due and payable no later than five days after completion of the reconciliation. If Franchisee is due a credit after the January 15th reconciliation, Bambu will apply the overpayments to future monthly Royalty Fees until the overpayment is fully applied.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, the royalty fee is 3.5% of Net Revenues. The franchisee must pay $800 per month, due on the first day of each month, starting the month after operations begin.
On or before January 15th of each year, Bambu reconciles the royalty fee for the prior calendar year, based on the franchisee’s actual Net Revenues. This reconciliation involves subtracting all previously paid royalty fee amounts related to the franchisee's prior year operations. Any additional amounts owed are due within five days of completing the reconciliation. If the reconciliation shows that the franchisee overpaid, Bambu will credit the overpayment to future monthly royalty fees until it is fully applied.
For a Bambu franchisee, this means that while there is a fixed monthly payment, the actual royalty fee is based on a percentage of revenue, reconciled annually. Franchisees need to maintain accurate sales records from their POS system, as these records are the basis for royalty fee calculations. Franchisees should also be aware of the potential for additional payments or credits after the annual reconciliation.