What is the general royalty rate for a Checkersrallys franchise, and what conditions might cause it to vary?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchise restaurant royalties are earned as the franchise delivers food to their customer or to a third-party delivery partner. The Company recognizes the royalty revenue in the period in which the franchise sales occur over the contract term of the franchise agreement. The Company generally bills royalties bi-monthly or bi-weekly to franchise customers and the payment is due within 10 days of the billing. See the "accounts and notes receivable" below for additional information on franchise royalty payments. Royalty rates are generally 4% of net sales but the rates may vary based on restaurants qualifying under certain development or reimaging programs.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the general royalty rate is 4% of net sales. However, this rate may vary for restaurants that qualify under specific development or reimaging programs. Checkersrallys franchise restaurant royalties are earned when the franchise delivers food to their customer or to a third-party delivery partner.
Checkersrallys typically bills royalties either bi-monthly or bi-weekly, with payment due within 10 days of the billing date. It is important for prospective franchisees to understand the specific conditions under which the royalty rate may differ from the standard 4% and to evaluate how these conditions might affect their financial obligations.
In addition to franchise restaurant royalties, Checkersrallys also earns retail royalty fees from the sale of licensed products, such as the Famous Seasoned Fries©, at retail outlets. These retail royalties are payable monthly within 30 days and vary based on retail sales volume. Franchisees should inquire about the details of these programs and how they might impact their overall revenue and royalty obligations.