When is the Default Royalty fee of 1% of Gross Sales due for a Churchs Chicken franchise?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
| TYPE OF FEE1 | AMOUNT | DUE DATE | REMARKS |
|---|---|---|---|
| Default Royalty | 1% of Gross Sales | Within 5 business days after the end of each fiscal week. | For as long as you are in default under the Franchise Agreement, we may raise your Royalty Fee by 1% of Gross Sales. |
Source: Item 6 — OTHER FEES (FDD pages 19–24)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, the Default Royalty fee, which is 1% of Gross Sales, is due within 5 business days after the end of each fiscal week. This fee is imposed only when a franchisee is in default under the Franchise Agreement. During the period of default, Churchs Chicken has the right to increase the Royalty Fee by this additional 1% of Gross Sales.
This means that if a Churchs Chicken franchisee fails to meet certain obligations outlined in the Franchise Agreement, such as maintaining brand standards or making timely payments, they may be considered in default. As a consequence, in addition to addressing the initial default, the franchisee will be required to pay this increased royalty fee.
It's important for prospective franchisees to understand the terms of the Franchise Agreement and ensure they can meet all obligations to avoid default and the associated Default Royalty fee. Franchisees should maintain open communication with Churchs Chicken to address any potential issues promptly and prevent them from escalating into a default situation.