What royalty fee level is required for a Checkers Franchised Restaurant located at a Non-Traditional Site?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
in the future.
Non-Traditional Site Addendum
If the Franchised Restaurant is to be located at a Non-Traditional Site, you must enter into our Non-Traditional Site Addendum attached as Exhibit B-3. The Non-Traditional Site Addendum requires you to pay a reduced initial franchise fee of $15,000 and a reduced royalty fee level of 2% of Net Sales at the Franchised Restaurant (as reduced from the standard royalty fee of 4% for new Franchised Restaurants); and, to the extent we or our affiliates can reasonably arrange with the membership of your regional or local cooperative, a reduced cooperative advertising contribution level equal to 50% of the contribution level payable by fellow members of your regional or local cooperative (whose restaurants are not located at a Walmart or other Non-Traditional Site), if any such cooperative already exists
Source: Item 5 — INITIAL FEES (FDD pages 17–21)
What This Means (2025 FDD)
According to Checkers's 2025 Franchise Disclosure Document, franchisees who operate a Checkers restaurant at a non-traditional site are subject to a different royalty fee structure than those at traditional locations. Specifically, the royalty fee for a non-traditional site is 2% of Net Sales. This is a reduction from the standard royalty fee of 4% for new Checkers Franchised Restaurants.
In addition to the reduced royalty fee, Checkers also stipulates that the cooperative advertising contribution level may be reduced. If Checkers or its affiliates can reasonably arrange it with the membership of the franchisee's regional or local cooperative, the contribution level will be equal to 50% of what other members of the cooperative pay. This applies if such a cooperative exists or is formed in the area of the Checkers restaurant, and those members' restaurants are not located at a Walmart or other Non-Traditional Site.
This reduced royalty and potential advertising contribution could make operating a Checkers franchise at a non-traditional site more financially attractive. However, it is important for prospective franchisees to understand the specific conditions and requirements outlined in the Non-Traditional Site Addendum, including any obligations related to cooperative advertising and the definition of "Net Sales." Franchisees should also confirm whether a regional or local cooperative exists in their area and the likelihood of securing the reduced advertising contribution level.