What happens if the Body20 franchisee does not pay the Royalty Fee on time?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty Fee (2) | 8% of the Gross Sales of the Studio. | Currently due weekly by the 5th of each month (the "Payment Due Date") | See Note 2 for the definition of Gross Sales. |
Source: Item 6 — OTHER FEES (FDD pages 19–26)
What This Means (2025 FDD)
Based on the 2025 Body20 Franchise Disclosure Document, the Royalty Fee is 8% of the Studio's Gross Sales and is currently due weekly by the 5th of each month, referred to as the "Payment Due Date". The FDD excerpt does not explicitly state the consequences of failing to pay the Royalty Fee on time.
However, it is common practice in franchising that late payments typically incur late fees, interest charges, and potential default on the franchise agreement. Franchise agreements usually outline the franchisor's remedies for late payments, which may include suspension of services, termination of the agreement, and legal action to recover the unpaid amounts.
Prospective Body20 franchisees should carefully review the franchise agreement to understand the specific penalties and consequences associated with late payments of the Royalty Fee. It is also advisable to discuss this matter with the franchisor to gain a clear understanding of their policies and procedures regarding late payments.