When are the monthly Royalty fees due for a Buns On Fire franchise?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
n id="page-13-1">ITEM 6: OTHER FEES
| Type of Fee1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty | 6% of Gross Revenue2 | Payable monthly. This will be collected as of the first week of the month. | Royalty Fees are payable by automatic debit, and funds must be made available in your account for withdrawal. All monthly earnings reports are due by the fifth of each month for the previous month. |
| Proprietary Marketing Fund | 1% of Gross Revenue | Payable monthly. This will be collected as of the first week of the month. | We will use this to cover, among other things, collection of customer data, customer feedback and mystery shopping. Royalty Fees are payable by automatic debit, and funds must be made available in your account for withdrawal. All monthly earnings reports are due by the fifth of each month for the previous month. |
Source: Item 6 — OTHER FEES (FDD pages 12–16)
What This Means (2025 FDD)
According to Buns On Fire's 2025 Franchise Disclosure Document, the royalty fees, which are 6% of Gross Revenue, are payable monthly and will be collected as of the first week of the month. The FDD specifies that these royalty fees are payable by automatic debit, and franchisees must ensure funds are available in their account for withdrawal. Additionally, monthly earnings reports are due by the fifth of each month for the previous month.
This means that as a Buns On Fire franchisee, you will need to have systems in place to accurately track your gross revenue and ensure that the correct royalty amount is debited from your account during the first week of each month. Failing to have sufficient funds available could result in penalties or other consequences as outlined in the franchise agreement. The requirement for automatic debit is a fairly standard practice in franchising, designed to ensure timely and consistent payments to the franchisor.
Furthermore, the requirement to submit monthly earnings reports by the fifth of each month is crucial for Buns On Fire to verify the accuracy of royalty payments. Franchisees should maintain detailed records of all sales and revenue to facilitate the preparation of these reports. The FDD also defines "Gross Revenue" as all revenue of the Franchise Business, including all sales of products and services to customers of the Franchise Business (including income related to catering and delivery services, and any sales or orders of food products or food preparation services provided from or related to the Franchise Business), whether for cash or credit and regardless of collection in the case of credit. Gross Sales excludes excise, sales and use taxes, gross receipts taxes or similar taxes you pay based on revenues, if those taxes are separately stated when the customer is charged, and also excluding bona fide refunds actually paid to customers.
In summary, prospective Buns On Fire franchisees need to be prepared for a recurring monthly royalty payment, the amount of which is 6% of gross revenue, collected via automatic debit during the first week of each month, and a corresponding monthly earnings report due by the fifth of each month. Understanding these obligations is essential for managing the financial aspects of the franchise effectively.