How is the Royalty fee for Clear Pest Pros franchisees paid?
Clear_Pest_Pros Franchise · 2025 FDDAnswer from 2025 FDD Document
| Name of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty | 7% of Gross Sales, for the first 12 months of operation Beginning in month 7, the greater of 7% of Gross Sales, or 7% of the Minimum Gross Sales Requirement, which shall be no less than $700 | This fee is due by automatic debit on the 10th day of each month for Gross Sales generated during the preceding month. | See Notes 1 through 5. In addition to the Minimum Royalty, the Minimum Gross Sales requirement begins in month 13 of operations. If you fail to achieve the Minimum Gross Sales, we may collect the greater of the $700 per month (the "Minimum Royalty") or 7% of the Minimum Gross Sales Requirement. |
| Brand Marketing Fee | 2% of Gross Sales. | Deducted monthly at the same time and in the same manner as the Royalty beginning in month 13 of your operation | Your contribution to our Brand Marketing Fund for the common benefit of System franchisees. See Note 6. |
Before opening your Clear Pest Pros Business, you must sign and deliver to us the prescribed form of authorization to debit the Clear Pest Pros Business's checking account automatically for all fees due to us which is attached to the Franchise Agreement as Exhibit D.
For purposes of paying the Royalty, monthly reports are due by the 5th day of each month and payment is due on the 10th.
If you transfer the Franchise Agreement to a new owner, the Royalty for all jobs completed prior to the transfer must be paid on the day of closing, regardless of whether the invoice(s) is paid in full. On the effective date of termination of the Franchise Agreement, either by you or us, you must pay us the Royalty for all jobs completed prior to termination. We will draft the Royalty from your bank account on the 10th day of each month for the preceding month. You must pay the Royalty by electronic funds transfer or by such other means as we may specify. We may periodically specify other dates for payment of the Royalty.
As a franchisee, if you fail to achieve the minimum level of monthly Gross Sales for a period of three or more consecutive months, we may collect a Royalty equal to what you would have been assessed had you achieved the minimum level of Gross Sales, in addition to other remedies.
There is no minimum level of Gross Sales required for the first 12 months.
For months 13 to 24, the minimum level of monthly Gross Sales is $5,000 per month.
For months 25 to 36, the minimum level of monthly Gross Sales is $7,500 per month.
For months 37- 48, the minimum level of monthly Gross Sales is $10,000 per month.
For months greater than 48, the minimum level of monthly Gross Sales is $15,000 per month.
Enforcement of monthly gross sales minimums is waived during calendar quarters 1 (Jan-Mar) and 4 (Oct-Dec), provided the annual minimum is met.
Any additional minimum amounts due will be settled by March 31 of the subsequent calendar year, at our discretion.
If developed in your area, you may be required to contribute up to two percent (2%) of Gross Sales to such cooperative.
Source: Item 6 — OTHER FEES (FDD pages 20–28)
What This Means (2025 FDD)
According to Clear Pest Pros's 2025 Franchise Disclosure Document, the Royalty fee is paid via automatic debit from the franchisee's bank account on the 10th day of each month for the preceding month's gross sales. Franchisees must authorize this debit by signing a form attached to the Franchise Agreement as Exhibit D before opening their Clear Pest Pros business. The royalty is 7% of gross sales for the first 12 months. Beginning in month 7, the royalty is the greater of 7% of Gross Sales, or 7% of the Minimum Gross Sales Requirement, which shall be no less than $700.
Clear Pest Pros requires franchisees to submit monthly reports by the 5th day of each month, with payment due on the 10th. The Royalty compensates Clear Pest Pros for the use of its Marks, System, Territory, and Manuals. If a franchisee transfers their Franchise Agreement, all royalties for jobs completed before the transfer must be paid on the closing day, regardless of invoice payment status. Similarly, upon termination of the Franchise Agreement, all royalties for jobs completed before termination are immediately due.
If a Clear Pest Pros franchisee fails to meet the minimum level of monthly Gross Sales for three or more consecutive months (starting in month 13), Clear Pest Pros may collect a Royalty equal to what would have been assessed had the minimum level been achieved. The minimum gross sales levels increase over time: $5,000 per month for months 13-24, $7,500 per month for months 25-36, $10,000 per month for months 37-48, and $15,000 per month for months greater than 48. However, enforcement of these minimums is waived during calendar quarters 1 (January-March) and 4 (October-December), provided the annual minimum is met. Any additional minimum amounts due will be settled by March 31 of the subsequent calendar year, at Clear Pest Pros's discretion.
In addition to the Royalty, Clear Pest Pros franchisees must also contribute 2% of their Gross Sales monthly to the Brand Marketing Fund, deducted at the same time and manner as the Royalty beginning in month 13. Franchisees may also be required to contribute up to 2% of Gross Sales to local or regional advertising cooperatives, if developed in their area, also deducted monthly at the same time and in the same manner as the Royalty.