What is the minimum monthly royalty fee for Craters & Freighters in year 8?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
At the end of year 3, we will determine the Minimum Performance Standards and Minimum Monthly Royalty Fees for years 4-15 of the Franchise Agreement and you will be provided with an amendment to your Franchise Agreement. We will base our decision on population, demographic factors, economic factors, competition, market penetration, the growth rate of other Craters & Freighters Franchised Businesses, and other relevant factors. If you are entering into a Successor Franchise Agreement, we will determine the Minimum Performance Standards and Minimum Monthly Royalty for your successor term.
Your failure or refusal to satisfy your Minimum Performance Standards may result in the reduction or modification of your Territory. These Minimum Performance Standards are not, and should not be considered, financial performance representations for your Franchised Business.
You may only solicit business in the Territory for the purpose of obtaining customers who reside or operate within the Territory, and you cannot knowingly solicit business outside of the Territory.
Source: Item 12 — TERRITORY (FDD pages 29–32)
What This Means (2025 FDD)
Based on the 2025 Craters & Freighters Franchise Disclosure Document, the minimum monthly royalty fee for year 8 is not explicitly stated. The FDD indicates that Craters & Freighters will determine the Minimum Performance Standards and Minimum Monthly Royalty Fees for years 4-15 of the Franchise Agreement at the end of year 3. These updated standards and fees will be provided to the franchisee in an amendment to the Franchise Agreement. The decision will be based on factors such as population, demographics, economic conditions, competition, market penetration, and the growth rate of other Craters & Freighters franchises.
For years 1-3, the FDD provides a table outlining the Minimum Performance Standard and Minimum Monthly Royalty Fee. In year 1, the Minimum Performance Standard is $200,000 and the Minimum Monthly Royalty Fee is $0. In year 2, the Minimum Performance Standard is $400,000 and the Minimum Monthly Royalty Fee is $1,667. In year 3, the Minimum Performance Standard is $510,000 and the Minimum Monthly Royalty Fee is $2,125.
Prospective franchisees should inquire with Craters & Freighters about the specific Minimum Performance Standards and Minimum Monthly Royalty Fees for years 4-15, as these are determined later in the franchise agreement and are not available at the time of initial franchising. Understanding these future financial obligations is crucial for long-term financial planning and assessing the viability of the franchise.