What is the general royalty rate for Checkersrallys franchise restaurants?
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 collects royalties as the franchise delivers food to customers or to a third-party delivery partner. The company typically bills these royalties either bi-monthly or bi-weekly, with payment due within 10 days of the billing date.
For a prospective franchisee, it's important to determine if the specific restaurant location or development plan qualifies for any royalty rate adjustments. Understanding the billing cycle and payment terms is also crucial for managing cash flow. Franchisees should inquire about the specific criteria for development and reimaging programs to understand if they can benefit from a reduced royalty rate.