How does Buildingstars collect the Non-Performance Fee from the franchisee?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
throughout the term of this Agreement. For example, the Royalty Fee for February is payable by March 15th. BUILDINGSTARS will withhold the Royalty Fee from the amount of billings BUILDINGSTARS collects for the FRANCHISEE, as more fully described in Section VI.D below. No part of the Royalty Fee is refundable. Notwithstanding the foregoing, FRANCHISEE shall pay a Royalty Fee of thirty percent (30%) instead of ten percent (10%) on the Gross Sales attributable to Specialty Work.
- B. Non-Performance Fee. In order to encourage full attention to Customer needs, a Non-Performance Fee will be charged if BUILDINGSTARS' standards have not been followed resulting in a Customer's complaint in which BUILDINGSTARS intervenes to resolve. If BUILDINGSTARS receives a bona fide complaint from a Customer, BUILDINGSTARS will first offer FRANCHISEE an opportunity to remedy the Customer's complaint. If FRANCHISEE remedies the complaint within a twenty-four (24) hour period after BUILDINGSTARS is notified of the Customer's complaint, BUILDINGSTARS will
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars' 2025 Franchise Disclosure Document, the Non-Performance Fee is collected by withholding the fee from the amount of billings Buildingstars collects for the franchisee. This fee is incurred when Buildingstars' standards are not followed, resulting in a customer complaint that requires Buildingstars to intervene.
Buildingstars will first offer the franchisee an opportunity to remedy the customer's complaint within 24 hours of notification. If the franchisee successfully addresses the complaint within this timeframe, a Non-Performance Fee will not be charged. However, if the complaint remains unresolved after the 24-hour period, Buildingstars has the right, but not the obligation, to resolve the complaint themselves.
If Buildingstars resolves the complaint, the franchisee will be charged a Non-Performance Fee of $25 per hour per person needed to resolve the complaint, in addition to any actual out-of-pocket expenses incurred by Buildingstars. This fee will then be withheld from the payments Buildingstars collects on behalf of the franchisee.