How often is the Body20 Royalty Fee due?
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. |
NOTES:
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- "Gross Sales" means all revenue that you receive or otherwise derive from operating the Studio, whether from cash, check, credit or debit card, gift card or gift certificate, or other credit transactions, and regardless of collection or when you actually provide the products or services in exchange for the revenue. If you receive any proceeds from any business interruption insurance applicable to loss of revenue at the Studio, there shall be added to Gross Sales an amount equal to the imputed Gross Sales that the insurer used to calculate those proceeds. Gross Sales includes promotional allowances or rebates paid to you in connection with your purchase of products or supplies or your referral of customers. Gross Sales does not include (i) any bona fide returns and credits that are actually provided to customers and (ii) any sales or other taxes that you collect from customers and pay directly to the appropriate taxing authority. You may not deduct payment provider fees (i.e., bank or credit card company fees and gift card vendor fees) from your Gross Sales calculation.
Source: Item 6 — OTHER FEES (FDD pages 19–26)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, the Royalty Fee is currently due weekly and must be paid by the 5th of each month, referred to as the "Payment Due Date." The Royalty Fee is 8% of the Gross Sales of the studio. Gross Sales includes all revenue derived from operating the studio, whether from cash, credit, or other transactions, but excludes bona fide returns, credits, and sales taxes collected from customers.
For a prospective Body20 franchisee, this weekly royalty payment schedule means that you need to have systems in place to accurately track and report your Gross Sales on a weekly basis. You must also ensure that you have sufficient cash flow to meet this ongoing obligation. The FDD specifies that the royalty fee is calculated as a percentage of Gross Sales, which is comprehensively defined to include nearly all forms of revenue but allows for deductions of returns, credits, and sales taxes.
It is important to note that the definition of Gross Sales does not allow for the deduction of payment provider fees, such as bank or credit card company fees. This means that the royalty is calculated on the total revenue before these fees are deducted, which could slightly increase the amount of the royalty payment. Franchisees should factor this into their financial planning and ensure they understand how Gross Sales is calculated to avoid any discrepancies.
The weekly payment schedule, while potentially demanding in terms of administrative overhead, does provide Body20 with a consistent revenue stream and may allow for closer monitoring of franchisee performance. Franchisees should be prepared to meet this obligation promptly to avoid any potential penalties or breaches of the franchise agreement.