When are Royalty Fees due for an Engineering For Kids franchise?
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" mean |
Source: Item 6 — OTHER FEES (FDD pages 10–15)
What This Means (2025 FDD)
According to Engineering For Kids's 2025 Franchise Disclosure Document, Royalty Fees are due monthly, specifically on or before the 5th day of each subsequent period. The document specifies that the payment is based on the Gross Sales for the prior period. However, the Royalty payment will not be less than the "Minimum Royalty" when applicable.
The "Minimum Royalty" requirement is waived for the first six months after signing the Franchise Agreement. Starting in the seventh month, the minimum royalty is $300 per month. The Engineering For Kids FDD specifies that to qualify for reduced royalty rates (less than 7%), franchisees must comply with their Royalty and Brand Fund Contribution requirements.
Engineering For Kids has the right to require franchisees to make these payments via electronic fund transfer. Unless otherwise specified in writing, royalties are paid monthly, with a "Period" defined as a month. However, Engineering For Kids retains the right to change the designated period to alternative time frames, including bi-weekly or weekly, with written notice. Franchisees must maintain sufficient balance in their operating account to meet payment requirements if electronic debit is required. Franchisees are not allowed to deduct or withhold any royalty fees or other payments due under the Franchise Agreement based on alleged non-performance by Engineering For Kids.