When are Royalty Fees from Affiliate Franchised Bhc Restaurants due?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
Item 6: Other Fees
OTHER FEES
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty Fee from Affiliate Franchised BHC Restaurants | 4.5% of Gross Revenue (2)(3) | Payable monthly on the following 5th days for the previous month (unless that day is a banking holiday, in which case the Royalties are due and payable on the next business day). Royalties will be calculated on the Gross Revenues received during every two (2) weeks. | Paid to us. We require payment by electronic funds transfer ("EFT"). We reserve the right, upon 90 days' written notice to you, to require you to pay Royalty Fees on a more frequent basis, including monthly or weekly |
| Royalty Fee from Subfranchised BHC Restaurants | 4.5% Gross Revenues of Subfranchised BHC Restaurants. (3) | Same date as the Royalty Fee from Affiliate Franchised BHC Restaurants | Paid to us. We require payment by electronic funds transfer ("EFT"). We reserve the right, upon 90 days' written notice to you, to require you to pay Royalty Fees on a more frequent basis, including monthly or weekly The maximum royalty you can charge Subfranchisee is 7% of Gross Revenues. |
Source: Item 6 — Other Fees (FDD pages 12–18)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the royalty fee from affiliate franchised Bhc restaurants, which is 4.5% of gross revenue, is payable monthly on the 5th day of the following month for the previous month's revenue. If the 5th day falls on a banking holiday, the royalty payment is due on the next business day. These royalties are calculated based on the gross revenues received every two weeks. Bhc requires that these payments be made via electronic funds transfer (EFT).
Bhc retains the right to modify the payment schedule for royalty fees. With 90 days' written notice, Bhc can require franchisees to pay royalty fees more frequently, such as monthly or even weekly. This change could impact a franchisee's cash flow management, requiring them to adjust their financial planning and budgeting processes.
The FDD also specifies that 'Gross Revenue' includes revenue from various sources, such as cash sales, gift card redemptions, credit transactions, and sales from delivery services like Door Dash and Uber Eats. It excludes taxes collected from customers, bona fide customer refunds, and employee tips. Subfranchisees must also pay a royalty fee of 4.5% of gross revenues, and the royalty charged to subfranchisees cannot exceed 7% of gross revenues.