How does a Closet Storage Concepts franchisee make weekly royalty payments?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall participate in Franchisor's electronic funds transfer program under which Franchisor automatically deducts the weekly royalty and other payments owed to Franchisor under this Agreement from Franchisee's bank account.
Before opening, Franchisee shall sign and give to Franchisor's bank all documents necessary to effectuate this program.
Franchisee shall immediately notify Franchisor of any change in Franchisee's banking relationship, including changes in account numbers.
Franchisor may require that Franchisee execute its then-current form of electronic funds transfer agreement, a copy of which is attached hereto as Exhibit 12.
Franchisor reserves the right to require Franchisee to submit all payments due to Franchisor or its affiliates arising out of or related to the Franchised Business in any form or manner Franchisor prescribes.
All weekly payments required under this section shall be due and deducted from Franchisee's bank account on Monday of each week on the receipts for the preceding week or such other day as Franchisor mandates.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2025 FDD)
According to Closet Storage Concepts's 2025 Franchise Disclosure Document, franchisees are required to participate in an electronic funds transfer program for royalty payments. This means that Closet Storage Concepts will automatically deduct the weekly royalty fees, along with any other payments owed, directly from the franchisee's bank account.
Prior to opening their Closet Storage Concepts business, franchisees must provide the necessary documentation to the franchisor's bank to enable these electronic transfers. Franchisees are also obligated to promptly inform Closet Storage Concepts of any changes to their banking relationship, such as changes in account numbers. Closet Storage Concepts retains the right to request franchisees to sign their current electronic funds transfer agreement, which is included as an exhibit in the agreement.
The FDD specifies that all weekly payments are due and will be deducted from the franchisee's bank account on Monday of each week. These payments cover the receipts from the preceding week, although Closet Storage Concepts reserves the right to change the day on which these deductions are made. This electronic funds transfer system ensures that royalty payments are made in a timely and consistent manner, reducing the administrative burden on both the franchisee and Closet Storage Concepts.