What are 'System Fees' for a Budget franchise?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
License Fees and Monthly Marketing Fees are collectively referred to as "System Fees."
- 7.4 Reservation Fees.
Licensee will participate in the Reservation System Budget designates and in no other reservation system and will pay to Budget or one of its Related Entities the then-current reservation fees established by Budget or one of its Related Entities for each reservation transmitted to Licensee whether or not the reservation results in a rental ("Reservation Fees").
Licensee will accept and service all reservations at the time of day requested by the customer.
The current Reservation Fee is identified in the Summary Pages (Section 10(d)).
This fee is subject to change at the discretion of Budget.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, 'System Fees' are the collective term for License Fees and Monthly Marketing Fees. License Fees are paid to Budget by the tenth of each month for operating the Rental Business, as detailed in Section 10(b) of the Summary Pages. These fees are associated with the Rental Business. The definition of Gross Revenue for the Rental Business is defined in Paragraph 7.10. All fees due are documented through the Monthly System Fee Report and invoice, which the Licensee submits to Budget along with all fees due. These fees are subject to adjustments based on audits conducted by Budget.
In addition to License Fees, franchisees must also pay Monthly Marketing Fees, as specified in Section 10(c) of the Summary Pages. Both License Fees and Monthly Marketing Fees are referred to collectively as 'System Fees.'
Prospective franchisees should carefully review Section 10 of the Summary Pages to understand the specific amounts and calculation methods for both License Fees and Monthly Marketing Fees. Understanding how these fees are calculated and when they are due is crucial for managing the financial aspects of the Budget franchise.