When is the Royalty fee due for a Floyds 99 franchise?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty1 | 6% of Gross Sales | Payable on the day of the week we periodically designate, based on prior week's Gross Sales | Gross Sales include all revenue from the Barbershop, including sales made away from the Barbershop premises. Gross Sales do not include sales taxes and discounts that have been approved by us in advance. Royalties are paid by electronic transfer of funds. |
| National Marketing Contribution1 | Currently 1.5% of Gross Sales, but we can require (upon 90 days' notice to you) up to a maximum of 3.0% of Gross Sales. The combination of the National Marketing Contribution and Local Advertising Allocation will not exceed a total of 4% of Gross Sales. (See Royalty Remarks above for discussion of "Gross Sales") | Payable on the day of the week we periodically designate, based on prior week's Gross Sales | We currently collect a National Marketing Contribution equal to 1.5% of Gross Sales and reserve the right to increase this amount up to 3.0% of Gross Sales on 90 days' prior written notice to you. Contributions are used primarily for production of advertising and marketing for the Barbershops. See Item 11. Our affiliate-owned Barbershops contribute the same as franchisee-owned Barbershops. The National Marketing Contribution is paid by electronic transfer of funds separate from the royalty transfer. Certain franchisees that signed Franchise Agreements prior to the date of this Disclosure Document have a National Marketing Contribution requirement of 1% of Gross Sales. |
| Local Advertising Allocation2 | 1% to 2% of Gross Sales The combination of the National Marketing Contribution and Local Advertising Allocation will not exceed a total of 4% of Gross Sales. | As incurred | The Local Advertising Allocation is in addition to the National Marketing Contribution, but is retained by you to advertise your Barbershop. This is the minimum average you must spend each calendar quarter, with a report of expenditures submitted as part of your required financial reporting to us. Funds spent on local advertising must be focused on the promotion of your Shop to consumers. Funds spent through sites or networks such as Indeed, Craigslist, or other similar sites or professional networks, whether to recruit employees or for other purposes, are not approved as local advertising. If we establish a Regional Advertising Co-op which includes your Barbershop, your Local Advertising |
Source: Item 6 — OTHER FEES (FDD pages 14–20)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, the royalty fee is 6% of gross sales and is payable on the day of the week that Floyds 99 periodically designates. This payment is based on the prior week's gross sales. Gross sales include all revenue from the barbershop, including sales made away from the barbershop premises, but do not include sales taxes and discounts that have been approved by Floyds 99 in advance. Royalty payments are made via electronic transfer of funds.
In addition to the royalty fee, Floyds 99 franchisees must also pay a National Marketing Contribution, which is currently 1.5% of gross sales but can be increased to a maximum of 3.0% with 90 days' notice. This contribution, like the royalty fee, is payable on the day of the week Floyds 99 periodically designates and is also based on the prior week's gross sales. The National Marketing Contribution is used primarily for advertising and marketing efforts for the Floyds 99 barbershops. It is also paid via electronic transfer of funds, separate from the royalty transfer.
Franchisees are also responsible for a Local Advertising Allocation, which ranges from 1% to 2% of gross sales. This allocation is incurred as the franchisee spends money on local advertising. The combined National Marketing Contribution and Local Advertising Allocation cannot exceed 4% of gross sales. Franchisees must submit a report of expenditures as part of their required financial reporting to Floyds 99. Funds spent on local advertising must be focused on promoting the shop to consumers and cannot be used for recruitment or other purposes.