When does the minimum royalty payment obligation begin for a Caring Transitions franchise?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
em 6. You must pay a monthly Royalty equal to the greater of 6% of actual Gross Receipts from the prior month or the Minimum Royalty. The Minimum Royalty is $300 a month for 12 months after the minimum royalty start date and then $500 a month. You are not required to pay the Minimum Royalty until the fifth day of the second month following the month in which you complete the training program held at our corporate headquarters. We will extend the Minimum Royalty start date for an additional month if you comply with System Standards for opening your business (including completing a business plan and recommended marketing activities), sign a general release, and are in full compliance with the Franchise Agre
Source: Item 6 — OTHER FEES (FDD pages 13–16)
What This Means (2025 FDD)
According to Caring Transitions's 2025 Franchise Disclosure Document, the minimum royalty payment obligation typically begins on the fifth day of the second month following the month in which the franchisee completes the initial training program at the corporate headquarters. The minimum royalty is $300 per month for the first 12 months after the start date, and then increases to $500 per month thereafter.
However, Caring Transitions offers a one-month extension to the minimum royalty start date under certain conditions. To qualify for this extension, the franchisee must comply with the System Standards for opening their business. This includes completing a business plan and engaging in recommended marketing activities. Additionally, the franchisee must sign a general release and be in full compliance with the Franchise Agreement.
In summary, while the standard start date for minimum royalty payments is shortly after training, a new Caring Transitions franchisee can delay this obligation by one month if they meet specific operational and compliance criteria set by the franchisor. This provides a small window for new franchisees to establish their business before the minimum royalty payments begin.