Are Royalty Fees paid to Circle K refundable?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
Royalty Fees are payable to us and are non-refundable. All monthly payments required by the Convenience Store Franchise Agreement must be paid by electronic funds transfer via the Automated Clearing House ("ACH") or wired to us or our affiliate by the 25th day of each month for the preceding calendar month's business activity. If the 25th day of the month falls on a Saturday or Sunday, such fees shall be paid on the Monday following the 25th day of the month. Any payment not actually received on or before such date will be deemed overdue.
Source: Item 6 — OTHER FEES (FDD pages 22–35)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, Royalty Fees paid to Circle K are non-refundable. The FDD specifies that all fees are generally nonrefundable unless explicitly stated otherwise.
The Royalty Fee is a recurring payment, typically a percentage of gross sales, that franchisees pay to Circle K for the right to use the Circle K brand, system, and trademarks. The monthly Royalty Fee rate depends on factors such as the amount of equipment/construction funding the franchisee accepts from Circle K, whether the store is located in an area that restricts royalties on alcohol sales, and whether gaming machines are allowed in the store. The Royalty Fee will be the greater of $1,000 or the amount calculated based on the applicable percentage of Gross Sales.
This non-refundable policy means that once a Royalty Fee payment has been made to Circle K, it will not be returned to the franchisee under any circumstances. This is a standard practice in franchising, as these fees contribute to the franchisor's ongoing support, brand development, and system-wide improvements. Franchisees should factor this non-refundable aspect into their financial planning and ensure they understand the terms and conditions related to Royalty Fee payments.