What is the minimum royalty fee for Engineering For Kids, and when does it apply?
Engineering_For_Kids Franchise · 2025 FDDAnswer from 2025 FDD Document
escribed above.
ITEM 6 OTHER FEES
| Type of Fee (note 1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty Fees | The greater of: (a) the Applicable Royalty Rate(s) multiplied by the Gross Sales for the Period, or (b) a Minimum Royalty, which will be $300 per month beginning in the 7th month after you sign the Franchise Agreement. See Remarks for the Applicable Royalty Rates. | Payable monthly (at this time) on or before the 5th day of each subsequent Period (note 2) | The "Applicable Royalty Rates" are (note 2): • 7% of Gross Sales between $0 to $25,000 during the Period, • 6% of Gross Sales between $25,000.01 to $50,000 during the Period, and • 5% of Gross Sales in excess of $50,000 during the Period "Gross Sales" means all of your revenue from operating your Franchised Business, but excluding taxes collected from customers and paid to taxing authority, and customer coupon sales (for which customers do not pay for complimentary or reduced price services or product) and refunds. |
| Advertising Obligations (note 3) • Brand Fund • Regional Fund • Local Advertising expenditures | Maximum: 4% of your Gross Sales, plus (if applicable) the amount that your Minimum Local Ad Spend exceeds your Local Ad Percentage Spend for the month. Currently: • Brand Fund: 2%; |
Source: Item 6 — OTHER FEES (FDD pages 10–15)
What This Means (2025 FDD)
According to Engineering For Kids's 2025 Franchise Disclosure Document, franchisees must pay a royalty fee, which is the greater of either a percentage of gross sales or a minimum royalty amount. The minimum royalty fee is $300 per month.
This minimum royalty fee applies beginning in the seventh month after the franchisee signs the Franchise Agreement. Prior to the seventh month, franchisees are not subject to the minimum royalty requirement. The royalty fees are payable monthly, specifically on or before the 5th day of each subsequent period.
In addition to the royalty fee, Engineering For Kids franchisees must also provide a correct statement of their gross sales for the period just ended, along with any period reports outlined in the Brand Excellence Manual. Franchisees must also allow Engineering For Kids to reasonably inspect their original books and records. Franchisees must also pay advertising obligations, which include a brand fund, regional fund, and local advertising expenditures.