For a new Boulder Designs franchisee, what is the minimum royalty fee after month 24 for a Boulder Designs franchise?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
| New Franchisee: Greater of: (i) 7% of Collected Gross | | Revenue for the previous month; or (ii) the minimum royalty fee. | | The "minimum royalty fee" is: (i) $750 for the initial twelve (12) | | full and/or partial month after opening; and (ii) $950 per month | | for months 13-24; and (iii) $1,500 per month | | for the remainder | | of the term. | | *Royalty | | Fees are subject to increase as stated in Section 3.2.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, new franchisees pay a royalty fee that is the greater of 7% of collected gross revenue for the previous month or a minimum royalty fee. The minimum royalty fee for months 13-24 is $950 per month. After month 24, the minimum royalty fee increases to $1,500 per month for the remainder of the term.
This means that after the first two years of operation, a Boulder Designs franchisee must pay at least $1,500 per month in royalty fees, even if 7% of their gross revenue is less than that amount. This could impact the franchisee's profitability, especially in the early years when revenue may be lower.
It is important for prospective Boulder Designs franchisees to carefully consider this escalating minimum royalty fee and factor it into their financial projections. They should also inquire about any potential increases to the royalty fee, as the document states that royalty fees are subject to increase as stated in Section 3.2.