What was the royalty revenue for Beggars Pizza for the year ended December 31, 2023?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
respectively.
1. Summary of Significant Accounting Policies (cont'd)
Revenue Recognition (cont'd)
The Company records royalty revenue based on 5 percent of gross sales or $500 per month, whichever is higher, over ti
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 39)
What This Means (2025 FDD)
According to Beggars Pizza's 2025 Franchise Disclosure Document, the royalty revenue for the year ending December 31, 2023, was $1,561,237. Beggars Pizza calculates royalty revenue as the higher of 5% of gross sales or $500 per month. This revenue is recognized over the term of the franchise agreement as sales occur.
For a prospective franchisee, this indicates the revenue Beggars Pizza earns from its franchisees based on their sales performance. The royalty structure ensures that Beggars Pizza receives a minimum monthly payment, regardless of sales, but also benefits from higher sales volumes at the 5% rate.
It's important to note that the FDD also mentions that franchisees pay a marketing fee of 1% of their weekly sales directly to Beg Adv, LLC, and that commissary stores are ordered and fulfilled with Begcom, LLC. These additional fees and requirements should be considered when evaluating the overall financial obligations of operating a Beggars Pizza franchise.