How often is the Royalty Fee for City Publications payable?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty Fee | 6% of Gross Sales for Standard card deck mailings. 3% of Gross Sales for single card mailings and digital advertising | Payable twice each calendar quarter, based on the schedule for each deck mailing | See definition of Gross Sales.2 (Section 1) In case of deck/booklet cancelation, 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 is non-refundable. |
Source: Item 6 — OTHER FEES (FDD pages 10–13)
What This Means (2025 FDD)
According to City Publications's 2025 Franchise Disclosure Document, the Royalty Fee is payable twice each calendar quarter. The royalty is calculated as 6% of Gross Sales for standard card deck mailings and 3% of Gross Sales for single card mailings and digital advertising. The payment schedule is based on each deck mailing.
Gross Sales are defined as the aggregate of all revenue accrued from the sale of direct mail advertising, goods, services, and products related to the Franchised Business. This includes revenue from various sources like checks, cash, or credit, and proceeds from business interruption insurance. Exclusions from Gross Sales include refunds made in good faith, promotional and coupon discounts, and sales and equivalent taxes collected on behalf of a governmental taxing authority.
For a City Publications franchisee, understanding the royalty payment schedule and the definition of Gross Sales is crucial for financial planning and compliance. Franchisees need to accurately track their sales and ensure timely royalty payments to avoid late fees, which are $100 per occurrence plus interest on the overdue amount. The interest is the highest applicable legal rate, not exceeding 1.5% per month. In California, the maximum interest rate is 10% annually.