By what day of the month must a Best Brains franchisee pay the Royalty Fee?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
Note 1- Royalty Fees*. You must pay to us a "Royalty Fee" of 14% of Regular Gross Sales by the 19th of each month, or more frequently as the Company may designate, subject to a $750/month minimum:
- (1) "Regular Gross Sales" means all sales or revenues (other than Additional Program Sales and Add-On Program Gross Sales), derived directly or indirectly from the Franchised Business, including on and off premises (e.g., E-Learning). Regular Gross Sales also includes registration fees for any program and business interruption insurance proceeds. Regular Gross Sales does not include:
- (i) sales taxes collected from customers and paid to the appropriate taxing authority, and
- (ii) the amount of all coupons redeemed at the Franchised Business (but only if the coupons have been previously approved by the Company as provided in this Agreement and only if such coupons have been included in Regular Gross Sales)
- (2) Additional Program Sales. You shall pay us 14% of Additional Program Sales throughout the term of this Agreement. Additional Programs include but are not limited to: all programs offered by Best Brains such as Public Speaking, Baby Genius+, and Test Prep; revenue from events organized by the Franchised Business, including on and off premises; revenue from programs offered by the by the Franchised Business which have been previously approved by the Company as provided in the Franchise Agreement.
- (3) Add-on Programs Sales.
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, a franchisee must pay a Royalty Fee of 14% of Regular Gross Sales by the 19th of each month. This payment schedule may be subject to change, as Best Brains retains the right to designate more frequent payment intervals. The royalty fee is also subject to a minimum of $750 per month.
Regular Gross Sales include all revenues derived directly or indirectly from the Franchised Business, including on and off-premises activities like E-Learning, as well as registration fees for any program and business interruption insurance proceeds. However, Regular Gross Sales do not include sales taxes collected from customers and remitted to the appropriate taxing authority, or the amount of approved coupons that have been previously included in Regular Gross Sales.
Additionally, Best Brains franchisees must contribute $1 per subject per student per month, up to a maximum of $3, to the Brand Development Fund, with a minimum contribution of $250 per month. This contribution is due at the same time as the Royalty Fee, effectively making the 19th of each month the deadline for both payments. Failure to remit these payments by the due date may result in interest charges of 2% per month, or the maximum permitted by law, on the outstanding balance.