How is the Clear Pest Pros royalty fee paid?
Clear_Pest_Pros Franchise · 2025 FDDAnswer from 2025 FDD Document
Blank]*
| 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. |
| Technology Fee | $350 per month, per franchisee | Monthly | Fees for website hosting, email hosting, and other required technology or marketing related expenses. We reserve the right to increase this fee as determined by vendor(s), to include the cost to use our Call Center, and to charge an administration fee of up to 15% of the Technology Fee. |
| Software Fee | $750 per franchisee | Monthly | Fee for required software usage, covers up to 4 technicians. One-time set up fee is $650. We reserve the right to increase this fee as determined by vendors, and to charge an administration fee of up to 15% of the Software Fee. |
| Additional Training at your Location | $2,000 per person | Prior to scheduling our staff to visit your location | Payable if we send a Clear Pest Pros employee to your location for additional training; |
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 on the 10th day of each month for the previous month's gross sales. Franchisees must sign and deliver an authorization form to debit their business checking account automatically for all fees due to Clear Pest Pros, which is included as Exhibit D to the Franchise Agreement. Clear Pest Pros may periodically specify other dates for royalty payments. Monthly reports are due by the 5th day of each month, with payment due on the 10th.
The royalty fee is 7% of gross sales for the first 12 months of operation. Beginning in month 7, the royalty is the greater of 7% of gross sales or 7% of the minimum gross sales requirement, which will be no less than $700. If a franchisee fails to achieve the minimum level of monthly gross sales for three or more consecutive months, Clear Pest Pros may collect a royalty equal to what would have been assessed had the minimum level of gross sales been achieved.
Several factors influence the minimum gross sales requirement. There is no minimum for the first 12 months. For months 13-24, the minimum is $5,000 per month; for months 25-36, it is $7,500 per month; for months 37-48, it is $10,000 per month; and for months greater than 48, it is $15,000 per month. 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. Gross sales minimums are reflected on a per-territory basis.
If a Clear Pest Pros franchisee transfers their Franchise Agreement to a new owner, the royalty for all jobs completed before the transfer must be paid on the day of closing, regardless of whether the invoices are paid in full. Similarly, upon termination of the Franchise Agreement, the franchisee must pay Clear Pest Pros the royalty for all jobs completed before termination. This ensures that Clear Pest Pros receives all royalties owed up to the point of transfer or termination.