What is the minimum monthly Royalty fee for an Extreme Art Studio franchise?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
OTHER FEES**
| Type of Fee(1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty(2) | The greater of 8% of Gross Sales ("Royalty") or $500 per month ("Minimum Royalty") | Within five days after the end of the calendar month | The Royalty is based on "Gross Sales" during the previous month. Gross Sales are defined in Note 2. You must pay your Royalty via electronic funds transfer ("EFT"), or such other manner we may prescribe. The Minimum Royalty begins six months after you open your first Extreme Art Studio Business and immediately after you open additional Extreme Art Studio B |
Source: Item 6 — OTHER FEES (FDD pages 13–18)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, franchisees must pay a royalty fee. This royalty fee is calculated as the greater of 8% of gross sales or a minimum of $500 per month.
This minimum royalty payment begins six months after the franchisee opens their first Extreme Art Studio Business. It also applies immediately upon opening any additional Extreme Art Studio Businesses. The royalty fee is based on the gross sales from the previous month.
Extreme Art Studio requires franchisees to pay royalties via electronic funds transfer (EFT) or another method they prescribe. Gross sales include all revenue received from operating the Extreme Art Studio Business, including cash, checks, credit and debit card payments, barter exchanges, and proceeds from business interruption insurance. However, gross sales do not include sales, use, or service taxes collected from customers and remitted to the appropriate taxing authority, or customer tips.