When is the Marketing Fund Contribution paid by a Fly To Fit franchisee?
Fly_To_Fit Franchise · 2024 FDDAnswer from 2024 FDD Document
4.3 Marketing Contributions.
- (a) Marketing Fund Contribution. Franchisee shall pay Fly To Fit Franchise a contribution to the Marketing Fund (the "Marketing Fund Contribution") equal to 1% of Franchisee's Gross Sales (or such lesser amount as Fly To Fit Franchise determines), at the same time as the Royalty Fee.
4.7 Payment Terms.
- (a) Method of Payment. Franchisee shall pay the Royalty Fee, Marketing Fund Contribution, and any other amounts owed to Fly To Fit Franchise by pre-authorized bank draft or in such other manner as Fly To Fit Franchise may require. Franchisee shall comply with Fly To Fit Franchise's payment instructions.
- (b) Calculation of Fees. Franchisee shall report monthly Gross Sales to Fly To Fit Franchise by Tuesday of the following month. If Franchisee fails to report monthly Gross Sales, then Fly To Fit Franchise may withdraw estimated Royalty Fees and Marketing Fund Contributions equal to 125% of the last Gross Sales reported to Fly To Fit Franchise, and the parties will true-up the actual fees after Franchisee reports Gross Sales. Franchisee acknowledges
that Fly To Fit Franchise has the right to remotely access Franchisee's point-of-sale system to calculate Gross Sales.
- (c) Late Fees and Interest. If Franchisee does not make a payment on time, Franchisee shall pay a $100 "late fee" plus interest on the unpaid amount at a rate equal to 18% per year (or, if such payment exceeds the maximum allowed by law, then interest at the highest rate allowed by law).
- (d) Insufficient Funds. Fly To Fit Franchise may charge $30 for any payment returned for insufficient funds (or, if such amount exceeds the maximum allowed by law, then the fee allowed by law).
Source: Item 22 — CONTRACTS (FDD page 44)
What This Means (2024 FDD)
According to Fly To Fit's 2024 Franchise Disclosure Document, the Marketing Fund Contribution, which is equal to 1% of the franchisee's Gross Sales (or a lesser amount determined by Fly To Fit), is paid at the same time as the Royalty Fee.
The FDD also specifies the method of payment. The franchisee must pay the Royalty Fee, Marketing Fund Contribution, and any other amounts owed to Fly To Fit by pre-authorized bank draft or in another manner that Fly To Fit may require. Franchisees must also report monthly Gross Sales to Fly To Fit by Tuesday of the following month. If a franchisee fails to report monthly Gross Sales, Fly To Fit may withdraw estimated Royalty Fees and Marketing Fund Contributions equal to 125% of the last Gross Sales reported to Fly To Fit, and the parties will reconcile the actual fees after the franchisee reports Gross Sales.
Fly To Fit also has the right to remotely access the franchisee's point-of-sale system to calculate Gross Sales. If a franchisee does not make a payment on time, they will pay a $100 late fee plus interest on the unpaid amount at a rate equal to 18% per year (or the highest rate allowed by law). Fly To Fit may charge $30 for any payment returned for insufficient funds (or the fee allowed by law).