How does the royalty fee structure for Benjamin Franklin Plumbing (Item 6) compare to that of other service-based franchises?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
fits on products or services we provide and may receive rebates, administrative fees, commissions, or other payments on products and services that third party vendors provide.
Brand Fund. Franchisees must contribute to a marketing fund for the BENJAMIN FRANKLIN PLUMBING system (the "Brand Fund"). New franchisees are required to contribute to the Brand Fund an amount that we determine, not to exceed 4% of Gross Revenue. As of the date of this disclosure document, the required contribution is a declining percentage of annual Gross Revenue starting at 1.5% of the first $5,000,000 of Gross Revenue in the then-current calendar year (see Item 6). The rate reverts to 1.5% at the start of the next calendar year. Fra
What This Means (2025 FDD)
I am unable to provide a comparison of Benjamin Franklin Plumbing's royalty fee structure to that of other service-based franchises using the provided excerpts from the 2025 FDD. While Item 6, which typically details fees including royalties, is mentioned in Item 11 regarding the Brand Fund contribution, the actual details of the royalty fee structure itself are not present in the provided excerpts. Item 11 states that new Benjamin Franklin Plumbing franchisees are required to contribute to the Brand Fund, with the contribution being a declining percentage of annual Gross Revenue, starting at 1.5% of the first $5,000,000 of Gross Revenue in a calendar year.
To fully understand the royalty fee structure and how it compares to other franchises, a prospective Benjamin Franklin Plumbing franchisee should carefully review Item 6 of the complete 2025 FDD. This section should outline the specific royalty fees, how they are calculated (e.g., percentage of gross sales), and when they are due. Understanding the complete fee structure is essential for assessing the overall cost and profitability of the franchise.
Specifically, the franchisee should ask the franchisor for clarification on the following: the exact percentage used to calculate royalty fees, whether the percentage changes based on revenue or other factors, if there are any minimum royalty payments required, and how the royalty fees for Benjamin Franklin Plumbing compare to those of similar franchises in the plumbing or home services industry. This information is crucial for making an informed investment decision.