How must the Technology Fee be paid to Buff City Soap?
Buff_City_Soap Franchise · 2025 FDDAnswer from 2025 FDD Document
d non-refundable when paid.
OTHER FEES
| Type of Fee (See Note 13) | Amount* | Due Date | Remarks |
|---|---|---|---|
| Royalty Fee (See Note 1) | 6% of Net Sales | Currently payable monthly based on the prior calendar month's Net Sales and due on the 15th of each month | Payment must be made via electronic funds transfer. We reserve the right to modify the due date to every Friday for the preceding week commencing Monday and closing Sunday upon 60 days' prior written notice. |
| Brand Fund Contribution (See Note 2) | 2% of Net Sales | Currently payable monthly based on the prior calendar month's Net Sales and due on the 15th of each month | Payment must be made via electronic funds transfer. We reserve the right to increase the Brand Fund Contribution upon 60 days' written notice to you, but the Brand Fund Contribution, when combined with the Local Marketing Expenditure requirement, will not exceed 4% of Net Sales for the initial term of your Franchise Agreement. We have the right to modify the due date to every Friday based on Net Sales for the preceding week (commencing on Monday and closing on Sunday) upon 60 days prior written notice to you. |
| Local Marketing Expenditure (See Note 2) | 1% of Net Sales | Payable to vendors as incurred | We have the right to request copies of documentation evidencing your compliance with the Local Marketing Expenditure. |
| Technology Fee (See Note 3) | The monthly minimum is currently $500. | Monthly with the Royalty Fee payment | Payment must be made via electronic funds transfer. We reserve the right to modify the Technology Fee upon 60 days' prior written notice to you. We have the right to modify the due date to every Friday to coincide with payment of the Royalty Fee and Brand Fund Contribution. upon 60 days prior written notice to Franchisee. |
Source: Item 5 — INITIAL FEES (FDD pages 15–23)
What This Means (2025 FDD)
According to Buff City Soap's 2025 Franchise Disclosure Document, the Technology Fee must be paid via electronic funds transfer. The Technology Fee is invoiced monthly along with the Royalty Fee and Brand Fund Contributions. The current minimum Technology Fee is $500 per month, but Buff City Soap retains the right to increase this fee with 60 days' notice. Buff City Soap also has the right to modify the due date to every Friday to coincide with the payment of the Royalty Fee and Brand Fund Contribution, provided they give 60 days prior written notice to the franchisee.
This means that a Buff City Soap franchisee needs to ensure they have systems in place for electronic funds transfers to cover this monthly expense. The franchisee should also be prepared for potential increases to the Technology Fee, as well as possible changes to the payment due date, and factor these possibilities into their financial planning.
The Technology Fee covers the costs associated with providing technology to each Buff City Soap location, including software licenses, database management, software maintenance, internet/Wi-Fi, cyber security/firewalls, music copyrights, and general IT support. Loyalty program fees are also invoiced monthly with the Technology Fee.
Prospective franchisees should carefully consider the implications of these technology-related costs and payment terms, ensuring they understand what is covered by the Technology Fee and how potential increases could impact their profitability. Understanding these costs is crucial for accurate financial forecasting and managing the ongoing expenses of operating a Buff City Soap franchise.