When is the Royalty fee due for a Closet Storage Concepts franchise?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
OTHER FEES**
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty | 5% of Gross | Payable on each | (See Note 1) |
| Revenues | Monday via ACH for | ||
| subject to a | the week ending the | ||
| minimum of | immediately p |
Source: Item 6 — OTHER FEES (FDD pages 13–18)
What This Means (2025 FDD)
According to Closet Storage Concepts's 2025 Franchise Disclosure Document, the royalty fee is due each Monday via ACH. This payment covers the prior week's gross revenues, specifically for the week ending the immediately prior Saturday. The royalty is 5% of gross revenues, but is subject to a minimum of $125 per week.
Closet Storage Concepts collects the royalty fee via Automated Clearing House (ACH) which is a common practice for franchise systems. This means that Closet Storage Concepts will automatically withdraw the funds from the franchisee's designated bank account on a weekly basis. Franchisees must ensure that sufficient funds are available to avoid any unsuccessful transfer attempts, which could result in additional fees.
It is important to note that the term 'Gross Revenues' is defined in the Franchise Agreement. Gross Revenues include the total revenue from the franchised business, including cash and credit sales, sales of products and services, and installation charges. Sales taxes and similar taxes collected from customers are excluded from gross revenues, as are any legitimate refunds, rebates, and discounts.