When does the Minimum Royalty obligation begin for a Big Blue Swim School franchise?
Big_Blue_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
d. The Software License Fee is payment for your right to use our affiliate's proprietary BIG BLUE Swim School software ("LESSONBuddy") in operating your School.
Notwithstanding the above, you agree to pay us a minimum Software License Fee for each four (4)-week period during the Term equal to no less than One Thousand Five Hundred Dollars ($1,500), as periodically increased in accordance with Section 5.H below (the "Minimum Software License Fee"). We will prorate the Minimum Software License Fee payable based on the then-current Calculation Period for the Software License Fee. If the Software License Fees you pay us, based on the then-applicable percentage (not to exceed two percent (2%)) of the School's Gross Revenue during the applicable Calculation Period, do not equal the prorated amount of the Minimum Software License Fee for that Calculation Period, you must pay us the deficiency (in addition to all other amounts regularly due) on or before the Payment Day we specify (we may debit the deficiency automatically, as provided in Section 5.E below). The Minimum Software License Fee will not begin until after you hav
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to Big Blue Swim School's 2025 Franchise Disclosure Document, franchisees are required to pay a minimum Software License Fee. This fee is applicable for each four-week period during the term of the agreement and is no less than $1,500, subject to periodic increases. This minimum fee is prorated based on the Calculation Period for the Software License Fee.
If the standard Software License Fees, calculated as a percentage (up to 2%) of the school's gross revenue, do not meet the prorated minimum, the franchisee must cover the difference. This deficiency is due on the specified Payment Day and may be automatically debited by Big Blue Swim School.
However, the Minimum Software License Fee does not start immediately. Big Blue Swim School franchisees are not obligated to pay this minimum until after they have operated their school for twelve weeks. This provides a grace period for new franchisees to establish their business before the minimum royalty requirement takes effect.