Does the ongoing Royalty payment to Engel & Volkers cover all services provided by the franchisor?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
The ongoing Royalty payment stipulated in Section 14.2 will cover the services provided by Franchisor, except Franchisee will have to pay for services of third parties subject to such third parties' or Franchisor's then current price lists (for example, additional training and GG Magazine advertising, and for the cost of marketing materials).
Failure on Franchisee's part to avail itself of any services shall not affect the amount of the Royalty payments.
Each of these price lists (hereinafter called the "Price Lists") are subject to revision at any time by the third party or by Franchisor.
Franchisee will pay the prices set forth in the respective Price List then current at the time the services are ordered.
Franchisor will periodically provide Franchisee with a separate price list for training, the GG Magazine advertising, and marketing articles.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the ongoing royalty payments cover specific services provided by the franchisor, but not all services. The royalty covers access to the Engel & Volkers international network, training courses, administrative, technical, and marketing support related to the Engel & Volkers system, access to system documentation, information exchanges among franchisees, access to the Integrated Product Suite, and integration into the Engel & Volkers IT network, as well as optional programs, designations, and services that Engel & Volkers may develop.
However, franchisees are responsible for paying for certain additional services. These include services from third parties and additional training, GG Magazine advertising, and the cost of marketing materials. These additional costs are subject to change based on the third party's or Engel & Volkers' current price lists. Engel & Volkers will provide franchisees with separate price lists for training, GG Magazine advertising, and marketing articles.
It is important to note that failure to use any of the services provided does not affect the royalty payment amount. Franchisees must stay current with the price lists for additional services to budget accurately. This arrangement is fairly typical in franchising, where the base royalty covers core support, but franchisees pay separately for optional or specialized services.