How often are Crepe De Licious franchisees billed for royalties?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
- Sales & Usage Based Royalties Franchise rights are considered symbolic intellectual property. For sales-based and usage-based services, a franchisor recognizes revenue at the later of: (1) when the subsequent sales occurs; or (2) on the satisfaction or partial satisfaction of the performance obligation to which the royalty relates. Sales-based and usage-based royalties are recognized as earned. Royalties are billed for in the first week of each month and the franchisees have thirty days to pay.
Source: Item 23 — RECEIPTS (FDD pages 57–233)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, franchisees are billed for royalties in the first week of each month. Franchisees then have thirty days to pay the billed amount. These royalties are based on sales and usage of the Crepe De Licious system.
This monthly billing cycle is a standard practice in the franchise industry, allowing Crepe De Licious to maintain a consistent revenue stream while providing franchisees with a reasonable timeframe to manage their payments. The royalties are considered revenue for the franchisor, recognized as they are earned either when the subsequent sales occur or when the performance obligation related to the royalty is satisfied.
Prospective franchisees should be aware of this monthly obligation and factor it into their financial planning. Understanding the timing and amount of royalty payments is crucial for managing cash flow and ensuring the financial stability of their Crepe De Licious franchise. Additionally, franchisees should ensure they understand what sales and usage are subject to royalties to avoid any billing discrepancies.