How is the weekly royalty fee calculated for an Endless Summer Sweets franchise?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
4.7 Method of Payment and Reporting.
- (a) Method of Payment. Franchisee shall pay the Royalty Fee, Marketing Fund Contribution, and any other amounts owed to Franchisor by pre-authorized bank draft or in such other manner as Franchisor may require. Franchisee shall comply with Franchisor's payment instructions. If Franchisor elects to have payments made by pre-authorized bank draft, Franchisee shall execute the authorization attached to this Agreement as Exhibit 4.
- (b) Calculation of Fees. Each week, on a day designated by Franchisor, Franchisee shall report to Franchisor, its Gross Sales from the previous week. If Franchisee fails to report weekly Gross Sales, the
Source: Item 23 — RECEIPTS (FDD pages 39–125)
What This Means (2024 FDD)
According to Endless Summer Sweets' 2024 Franchise Disclosure Document, franchisees are required to pay a weekly royalty fee. Each week, on a designated day set by Endless Summer Sweets, the franchisee must report their Gross Sales from the previous week to the franchisor.
The method of payment for the Royalty Fee, Marketing Fund Contribution, and any other amounts owed to Endless Summer Sweets must be paid via pre-authorized bank draft or in another manner that Endless Summer Sweets may require. Franchisees must comply with Endless Summer Sweets' payment instructions and execute the authorization attached to the agreement as Exhibit 4 if Endless Summer Sweets elects to have payments made by pre-authorized bank draft.
It is important for prospective franchisees to understand the implications of this payment structure. The weekly reporting requirement means that franchisees must maintain accurate sales records and adhere to the franchisor's reporting schedule. The pre-authorized bank draft ensures timely payments but also requires franchisees to maintain sufficient funds in their account to cover the fees. Failure to comply with these requirements could result in penalties or other consequences as outlined in the franchise agreement.