How often is the City Publications Royalty Fee payable?

According to City Publications's 2025 Franchise Disclosure Document, the Royalty Fee is payable twice each calendar quarter. The amount of the royalty fee depends on the type of mailing. For standard card deck mailings, the royalty fee is 6% of Gross Sales. For single card mailings and digital advertising, the royalty fee is 3% of Gross Sales. The payment schedule is based on the schedule for each deck mailing. Gross Sales is defined as the aggregate of all revenue accrued from the sale of all direct mail advertising and from goods and services and products from all sources in connection with the Franchised Business.

It is important for prospective City Publications franchisees to understand how Gross Sales is calculated, as this directly impacts the royalty fees owed. The definition includes all revenue, whether received in cash, credit, or other forms, and also includes proceeds from business interruption insurance. However, it excludes refunds made in good faith, promotional and coupon discounts, and sales and equivalent taxes collected on behalf of a governmental taxing authority. Accrued revenue is accounted for in Gross Sales upon entering into any agreement for the sale of products and services.

Franchisees should also be aware of the implications of canceling a deck or booklet. If a deck or booklet is canceled, any royalty prepaid for that deck or booklet will be applied to any mailings taking place within the next four months, up to a maximum of two mailings. After four months, the prepaid royalty becomes non-refundable. This policy could impact a franchisee's cash flow if mailings are canceled and prepaid royalties cannot be fully utilized within the specified timeframe.