What is included in the definition of 'Monthly Contract Revenues' for a Buildingstars franchise?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
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Note 2: On-Site Manager Program.
The Initial Franchise Fee consists of two separate fees: a fixed fee ("Base Fee") and a variable fee ("MCR Fee"). The Base Fee is $3,995. The MCR Fee is 150% of the Monthly Contract Revenue if you pay cash and 200% of the Monthly Contract Revenue if the Initial Franchise Fee is financed. The MCR Fee is $3,000 ($2,000 Monthly Contract Revenue x 150%).
If you are not already a Technician Program franchisee, you must pay the Initial Franchise Fee in full when the Franchise Agreement is signed.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
Based on the 2025 Buildingstars Franchise Disclosure Document, the initial franchise fee is calculated using a Monthly Contract Revenue (MCR) component. For example, in one instance, the MCR Fee is calculated as 150% of the Monthly Contract Revenue. As an example, the MCR Fee is $3,000 based on a $2,000 Monthly Contract Revenue. In another example, the MCR Fee is 300% of the Monthly Contract Revenue. As an example, the MCR Fee is $30,000 based on a $10,000 Monthly Contract Revenue.
Buildingstars also uses Monthly Contract Revenue to determine a minimum revenue requirement. Commencing with the 13th month of operation, a Buildingstars franchisee must generate at least $20,000 in Monthly Contract Revenue each month for the remainder of the agreement term. Failure to meet this minimum may result in Buildingstars modifying the franchisee's area or terminating the agreement.
Buildingstars also uses Monthly Contract Revenue when replacing customer accounts. If a customer account is lost within the first six months because the customer ceases business, becomes insolvent, bankrupt, or moves outside the territory, Buildingstars will offer a new customer account or increase an existing one with Monthly Contract Revenue at least equal to the lost account's revenue.
The FDD does not explicitly define what elements constitute 'Monthly Contract Revenue.' A prospective franchisee should seek clarification from Buildingstars on exactly what is included in this definition, such as whether it includes only the base contract amount or if it incorporates additional fees, upcharges, or other revenue streams.