How often does a Chocolate Fish Coffee franchisee pay the royalty fee?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
Initial Franchise Fee.** Upon signing this Agreement, Franchisee shall pay an initial franchise fee in the amount stated on the Summary Page. This initial franchise fee is not refundable.
- 4.2 Royalty Fee. Franchisee shall pay Chocolate Fish Franchising a weekly royalty fee (the "Royalty Fee") equal to 6% of Gross Sales. The Royalty Fee for any given week is due on Wednesday of the following week.
4.3 Marketing Contributions.
Brand Fund Contribution. Franchisee shall pay Chocolate Fish Franchising a contribution to the Brand Fund (the "Brand Fund Contribution") equal to 1% of Franchisee's Gross Sales (or such lesser amount as Chocolate Fish Franchising determines), at the same time as the Royalty Fee.
- 4.4 Replacement / Additional Training Fee. If Franchisee sends an employee to Chocolate Fish Franchising's training program after opening, Chocolate Fish Franchising may charge its then-current training fee. As of the date of this Agreement, the training fee is $350 per day.
- 4.5 Non-Compliance Fee. Chocolate Fish Franchising may charge Franchisee $500 for any instance of non-compliance with the System Standards or this Agreement (other than Franchisee's non-payment of a fee owed to Chocolate Fish Franchising) which Franchisee fails to cure after 30 days' notice. Thereafter, Chocolate Fish Franchising may charge Franchisee $250 per week until Franchisee ceases such non-compliance.
Source: Item 23 — RECEIPTS (FDD pages 41–119)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, franchisees are required to pay a royalty fee on a weekly basis. The royalty fee is 6% of Gross Sales. The royalty fee for any given week is due on Wednesday of the following week.
Franchisees must report their weekly Gross Sales to Chocolate Fish Coffee by Monday of the following week. If a franchisee fails to report their weekly Gross Sales, Chocolate Fish Coffee has the right to withdraw estimated Royalty Fees and Brand Fund Contributions equal to 125% of the last Gross Sales reported. After the franchisee reports Gross Sales, the parties will reconcile the actual fees.
In addition to the royalty fee, Chocolate Fish Coffee franchisees must also pay a Brand Fund Contribution, which is 1% of the franchisee's Gross Sales. This contribution is paid at the same time as the royalty fee. Franchisees must make payments to Chocolate Fish Coffee via pre-authorized bank draft or in another manner that Chocolate Fish Coffee may require.