How does a Browns Chicken franchisee pay the weekly royalty fee, and what is the deadline for payment?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
m, Brown shall refund to Franchisee any payments made of the initial franchise fee, less the expenses theretofore incurred by Brown in connection with the grant of the Franchise to Franchisee and the training of Franchisee and its designees.
19. ROYALTY FEE AND OTHER PAYMENTS.
A. Amount and Payment of Royalty Fee.
Franchisee agrees to pay to Brown a weekly royalty fee of five percent (5%) of the Gross Sales of the Store (except for revenue from Video Gaming, the royalty fee on which is ten percent (10%) – see Exhibit G), payable on Gross Sales for each Monday through Sunday period by electronic transfer or automatic debit from Franchisee's bank account to Brown, as set forth below in Paragraph 19.F.
B. Definition of "Gross Sales".
The term "Gross Sales," as used in this Agreement, shall mean and include the aggregate actual gross selling prices of all food, beverages, and other products and services (including without limitation entertainment/video gaming) sold and/or performed and/or offered by or for Franchisee or the Store, in, upon or from the Premises, or through or by means of the business conducted therein or otherwise by the Store or Franchisee, including direct or indirect barter transact
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, franchisees are required to pay a weekly royalty fee. This fee is calculated as five percent (5%) of the store's Gross Sales, with a different rate of ten percent (10%) for revenue from Video Gaming.
The royalty fee payment covers sales from Monday through Sunday of each week. Browns Chicken mandates that franchisees remit this payment through electronic transfer or automatic debit directly from the franchisee's bank account. The specific procedures for this electronic transfer or automatic debit are detailed in Paragraph 19.F of the franchise agreement.
Browns Chicken also has measures in place for scenarios where a franchisee fails to submit the required sales reports. In such cases, Browns Chicken will estimate the royalty fee and advertising fund contribution based on the average sales of the last ten reported weeks. If a franchisee fails to report sales for two consecutive weeks, Browns Chicken will add an additional ten percent (10%) to the estimated amount based on the average sales of the last ten reported weeks. Additionally, Browns Chicken may withdraw amounts due for miscellaneous items (e.g., equipment, uniform purchasing, product transfers, etc.) that are over 30 days past due from the franchisee's bank account through the Bank Draft Plan.