What must happen before a New Member Kit or binder is sent to a C12 Group franchisee?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor must receive both registration form and payment before a New Member Kit or binder will be sent to Franchisee to, in turn, provide to any new C12 member(s).
While Franchisee's monthly Royalty Fee is established solely based on each month's membership roster and billings, Franchisee is solely responsible for invoicing and collecting registration fees and membership fees from Franchisee's members and setting collections policies and standards.
Franchisee will pay Franchisor Royalty Fees based on Franchisee's membership roster and billings regardless of whether Franchisee actually collects the registration and/or membership fees from its members.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, before a New Member Kit or binder is sent to a franchisee for distribution to a new C12 member, C12 Group must receive both the registration form and payment for that new member.
This policy ensures that C12 Group receives proper documentation and payment before a new member is fully integrated into the system. It also helps maintain the integrity and value of C12 Group membership by ensuring that all members are properly registered and financially current.
This requirement places the onus on the C12 Group franchisee to collect registration fees and submit the required forms and payments to the franchisor. While the franchisee is responsible for invoicing and collecting these fees from their members, they must still pay royalty fees to C12 Group based on their membership roster and billings, regardless of whether they have actually collected the fees from their members. This highlights the importance of franchisees establishing clear collections policies and standards to manage their cash flow effectively.