When does Benjamin Franklin Plumbing begin calculating interest on overdue payments?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (1) | Amount | Date Due | Remarks |
|---|---|---|---|
| Royalty Fee | 6% of Gross Revenue or $1,500 per month (the “Minimum Royalty”), whichever is greater. | Semi- monthly, unless we designate a different period | See Note 2 for the definition of “Gross Revenue.” See Note 3 for an explanation of the Minimum Royalty and the Royalty Fee payment schedule. |
| Type of Fee (1) | Amount | Date Due | Remarks |
| Management Fee | Up to $500 per day, plus our costs and overhead | Within 30 days after invoice | Payable only if: (a) the Key Person (see Item 15) dies or is incapacitated and we elect to manage the Franchised Business pending transfer of his or her interest; or (b) the Key Person is arrested for or formally charged with a serious criminal offense and we take over operation of the Franchised Business pending final disposition of the charges. |
| Step In Fee | Up to $500 per day, plus our costs and overhead | As invoiced | If you are in default under your Franchise Agreement, we have the right to step in and operate the Franchised Business until we determine the default has been cured. We may charge you a fee for these services. |
| Interest | 12% per annum or the maximum rate permitted by applicable law, whichever is less | With payment of overdue amount | Applies only if you do not pay us on time. We calculate interest from the date the payment was due until paid in full. |
| Late Fee | $100 for second occurrence of payment more than 30 days past due; $200 for third occurrence; $300 for each subsequent occurrence | With payment of overdue amount | We can charge a late fee to compensate us for our administrative costs incurred in enforcing your obligations to pay us and submit required reports to us. |
| Insufficient Funds Fee | $50 or the amount the bank charges us due to the insufficient funds, whiche |
Source: Item 6 — OTHER FEES (FDD pages 18–27)
What This Means (2025 FDD)
According to Benjamin Franklin Plumbing's 2025 Franchise Disclosure Document, interest begins accruing on overdue payments from the date the payment was due until it is paid in full. The interest rate is set at 12% per annum, or the maximum rate permitted by applicable law, whichever is less. This applies if a franchisee does not make payments to Benjamin Franklin Plumbing on time.
This means that if a Benjamin Franklin Plumbing franchisee misses a payment deadline, they will immediately start incurring interest charges on the outstanding balance. The interest continues to accumulate until the full overdue amount is paid. The 12% annual interest rate could substantially increase the amount owed over time, especially for larger overdue balances. Franchisees need to be aware of this policy and ensure timely payments to avoid these additional costs.
In addition to interest, Benjamin Franklin Plumbing also charges late fees for payments that are more than 30 days past due. The late fee starts at $100 for the second occurrence, $200 for the third, and $300 for each subsequent occurrence. Therefore, franchisees must prioritize timely payments to avoid both interest charges and escalating late fees.