What is a Best In Class Education Center franchisee obligated to pay monthly?
Best_In_Class_Education_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
e. On each royalty fee due date, you agree to pay LBIS (or us, if we so instruct) a BCP-LMS Monthly Fee, which is calculated as the sum of: (i) 2% of the Gross Sales minus Enrichment Sales; (ii) 1% of Special Program Sales; and (iii) Monthly Student User Fees (calculated in accordance with §14.3(c) below).
- (c) Monthly Student User Fees. "Monthly Student User Fees" are calculated by multiplying a "base fee" (as set forth in the Manual) by the total number of subjects taken by students enrolled at your Center as of the last day of the immediately preceding month. The base fee is currently $8 per student per subject per month (Mathematics, English and STEM are each considered a separate "subject"); provided, however, that: (i) we may increase the base fee, not more than once per calendar year, upon at least 90 days' prior notice; (ii) the maximum annual increase to the base fee is $2 per student per subject per month; (iii) the maximum base fee that we may charge at any point during the Term is $15 per student per subject per month; and (iv) if you are a renewing franchisee who operates a Legacy Center (as defined below), your initial base fee will be $4 per student per subject per month but will increase by $1 each January 31st until it equals the standard base fee charged to new franchisees. Monthly Student User Fees applicable during the first and/or last month of the Term may be prorated if the first and/or last month of the Term are less than a full calendar month. If the number of subjects taken by a student changes during the course of a month, then you must pay the Monthly Student User Fee based on the total number of subjects taken by the student during the month, regardless of how many subjects are taken by the student at any given point in time during the month.
Source: Item 23 — RECEIPT (FDD pages 47–204)
What This Means (2025 FDD)
According to the 2025 Best In Class Education Center FDD, franchisees are obligated to pay Monthly Student User Fees. These fees are calculated by multiplying a base fee by the total number of subjects taken by students enrolled at the franchisee's center as of the last day of the preceding month. The base fee is currently $8 per student per subject per month for Mathematics, English, and STEM, each considered a separate subject.
Best In Class Education Center may increase the base fee once per calendar year, providing at least 90 days' prior notice. The maximum annual increase is $2 per student per subject per month, with an absolute maximum base fee of $15 per student per subject per month during the term. For renewing franchisees operating a Legacy Center, the initial base fee is $4 per student per subject per month, increasing by $1 each January 31st until it matches the standard base fee for new franchisees.
Additionally, if a franchisee operates a Satellite Office, they must pay a technology fee of $100 per month per Satellite Office. This technology fee can be increased to a maximum of $200 per month per Satellite Office with 30 days' notice. The Monthly Student User Fees may be prorated during the first and/or last month of the term if those months are not full calendar months. If the number of subjects taken by a student changes during a month, the Monthly Student User Fee is based on the total number of subjects taken by the student during the month, regardless of when the change occurs.