How are royalties and advertising fees for a Brain Balance franchise paid?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
g expenses are accrued up to the amount of revenue to be utilized in the subsequent year. As of December 31, 2024, 2023, and 2022, $77,535, $133,665, and $232,489, respectively, was included in advertising fund accrued expenses. The amount of cash restricted for advertising fund expenses at December 31, 2024, 2023, and 2022 was $83,542, $134,030, and $121,060, respectively.
Payment Terms
Initial franchise, renewal, and transfer fees are due and typically paid when a franchise agreement is executed and are nonrefundable. Royalties and advertising fees are paid on a monthly basis based upon a percentage of franchisee gross sales. Software fees are paid on a monthly basis based upon a fixed amount defined within the franchise agreement. Enrollment kit fees are paid on a monthly basis based on the number of kits ordered. Coaching fee revenue is due after the coaching is provided and is invoiced net 30. Annual conference fees are typically prepaid upon registering. Settlement fees are due upon signing the settlement agreement. Franchise fees are collected prior to the sati
Source: Item 23 — RECEIPTS (FDD pages 72–292)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, royalties and advertising fees are paid on a monthly basis. These payments are determined as a percentage of the franchisee's gross sales. This means the amount a franchisee owes for royalties and advertising directly correlates with their monthly revenue.
Software fees for Brain Balance are also paid monthly, but these are based on a fixed amount that is defined within the franchise agreement. This differs from the variable royalty and advertising fees, providing a predictable monthly expense for software. Enrollment kit fees are also paid monthly, based on the number of kits ordered, which provides a direct cost associated with student enrollment.
This payment structure means that a Brain Balance franchisee's expenses for royalties and advertising will fluctuate with their sales performance. While this can be beneficial during slower months, it also means that higher sales volume will result in higher royalty and advertising payments. Prospective franchisees should carefully consider their projected sales and associated royalty and advertising obligations when evaluating the financial feasibility of the franchise.