How often are royalties collected from Better Blend franchisees?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
The Company's revenue consists of fees from franchised restaurants operated by conventional franchisees. Revenue from conventional franchised restaurants include initial franchise fees, royalties based on percent of sales, marketing fees based on percent of sales, and development fees for locations the franchisee opens in addition to the initial location.
Royalties are collected on a weekly basis and are based on certain percentage as specified on the franchise agreement. Marketing fees are based on up to 1% of gross revenue. The marketing fund is used for marketing expenses related to maximizing public recognition of the Company's brand and marketing fund.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 43)
What This Means (2024 FDD)
According to Better Blend's 2024 Franchise Disclosure Document, royalties are collected from franchisees on a weekly basis. These royalties are calculated as a percentage of sales, with the specific percentage detailed in the franchise agreement.
In addition to royalties, Better Blend also collects marketing fees, which are up to 1% of gross revenue. These marketing fees are earmarked for expenses related to enhancing public recognition of the Better Blend brand and supporting the marketing fund.
As a prospective franchisee, it's crucial to understand the specific royalty percentage outlined in your franchise agreement, as this will directly impact your weekly financial obligations to Better Blend. You should also factor in the potential marketing fees of up to 1% of gross revenue when projecting your operating expenses.