How many royalty installments are due each quarter for a City Publications franchise?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
| sFDD2025 | Franchisee's Initials: |
|---|---|
B. Royalty Fee and Advertising Fee
Franchisee shall pay without offset, credit, or deduction of any nature to Franchisor, so long as this Agreement shall be in effect, a Royalty Fee equal to six percent (6%) of Gross Sales. For any revenue or non-revenue sale, the minimum gross sales reported will be $2500.00 and the 6% royalty paid out will be from that amount. The royalty is due and payable in two installments each quarter. Each of Franchisee's deck sales will be scheduled by the parties hereto and the first royalty installment is due three weeks before the scheduled closing date for that deck, based on a minimum of 12 cards in the deck. The second installment is due immediately after the mailing of the deck, and serves as a reconciliation payment to cover any additional amounts due, including royalties for cards printed in excess of the minimum of 12. Franchisee may also participate in Franchisor's program whereby Franchisee can mail an individual advertising piece or do digital advertising, and the royalty for these programs is 3% of revenue.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, franchisees are required to pay royalties in two installments each quarter. The first royalty installment is due three weeks before the scheduled closing date for each deck sale, based on a minimum of 12 cards in the deck. The second installment is due immediately after the mailing of the deck. This second payment serves as a reconciliation to cover any additional amounts due, including royalties for cards printed in excess of the minimum of 12.
This payment structure means that City Publications franchisees must carefully track their deck sales and mailing schedules to ensure timely royalty payments. The initial installment is based on a minimum card count, providing a baseline payment, while the second installment adjusts for any additional cards printed, ensuring City Publications receives the correct royalty amount based on actual sales.
Additionally, City Publications franchisees may participate in a program that allows them to mail individual advertising pieces or do digital advertising, in which case the royalty is 3% of revenue. Revenues received by franchisees as a result of the email program are also subject to the royalty obligation. This provides franchisees with additional avenues for revenue generation, while also contributing to City Publications' royalty income.