What are the primary sources of revenue for Face Foundrie?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company's revenues consist primarily of initial franchise fees, royalties and advertising fees based on a percentage of net revenues and monthly flat fees for technology fees.
Royalties, advertising fees and technology fees
Upon evaluation of the five-step process, the Company has determined that royalties, advertising fees, and technology fees are to be recognized in the same period as the underlying sales.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 73)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, the company's revenues consist primarily of initial franchise fees, royalties, advertising fees, and technology fees. These fees are calculated as a percentage of net revenues, except for technology fees, which are collected as monthly flat fees.
In 2024, Face Foundrie's royalty fees totaled $1,736,820, franchise fees totaled $533,096, advertising fees totaled $523,187, and technology fees totaled $77,825. Training and support fees accounted for $4,000, and other operating revenue amounted to $225,601. The total operating revenues for 2024 were $3,100,529.
For a prospective franchisee, understanding these revenue streams is crucial. Royalties, advertising, and technology fees are recognized in the same period as the underlying sales, meaning these costs will be ongoing as the franchise operates. Initial franchise fees are allocated to pre-opening services and recognized as revenue when those services are completed, typically upon the commencement of operations. This revenue structure is typical in franchising, where franchisors derive income from initial fees and ongoing royalties and fees based on franchisee performance.