When is the Fat Shack Marketing and Promotion Fee payable, if implemented?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty1 | 6% of your Gross Sales2 | Payable weekly on Tuesday of each week based on the prior week's Gross Sales | The Royalty is for the ongoing grant of the rights to use the Marks and Licensed Methods, and on-going support. We will debit your bank account for the Royalty.3 You must meet minimum Sales Quota. See Item 12. |
| Marketing and Promotion Fee1 | None, but we reserve the right to charge up to 1½% of your Gross Sales2 | Payable with the Royalty Fee | We may collect a Marketing and Promotion Fee starting upon 30 days' notice to you. Once commenced, we will debit your bank account for amounts due.3 We may reallocate all or a portion of this fee to a Regional Advertising Program if one is established in your region. You must meet minimum Sales Quota. See Item 12. |
- 2 "Gross Sales" are defined as sales of any kind for all services or products purchased from or through your FAT SHACK Restaurant, including sales made for cash or upon credit, or partly for cash and partly for credit, regardless of collection of charges for which credit is given, regardless of whether sales are conducted in compliance with or in violation of the terms of the Franchise Agreement, and regardless of whether sales occur at the site of your FAT SHACK Restaurant or off-site, but excluding discounts, sales taxes, or other similar taxes and credits. "Gross Sales" includes delivery fees and revenue from the redemption of FAT SHACK gift certificates, customer loyalty cards, gift cards and other prepaid cards. "Gross Sales" also includes the fair market value of any services or products you receive in barter or exchange for your products and services.
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Interest and Late Payment Charges1 | Lesser of 1½% per month or highest rate of interest allowed by law, plus a $50 late filing charge | Upon demand | Begins to accrue the day after payments are due for the Royalty Fees and Marketing and Promotion Fees. |
Source: Item 6 — Other Fees (FDD pages 15–18)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, the Marketing and Promotion Fee, if implemented, is payable along with the Royalty Fee. Currently, Fat Shack does not charge this fee, but they reserve the right to charge up to 1½% of your Gross Sales.
Fat Shack will provide franchisees with 30 days' notice before commencing the Marketing and Promotion Fee. Once the fee is commenced, Fat Shack will debit the franchisee's bank account for the amount due. The fee is calculated based on Gross Sales, which include all sales of services or products from the Fat Shack Restaurant, whether for cash or credit, and regardless of where the sales occur. Gross Sales also include delivery fees and revenue from gift cards, loyalty cards, and prepaid cards, as well as the fair market value of bartered services or products.
Interest and late payment charges will begin to accrue the day after payments are due for the Royalty Fees and Marketing and Promotion Fees. These charges are the lesser of 1½% per month or the highest rate of interest allowed by law, plus a $50 late filing charge. Fat Shack also reserves the right to reallocate all or a portion of this fee to a Regional Advertising Program if one is established in the franchisee's region. Franchisees must also meet minimum Sales Quota.