When is the Fly To Fit royalty fee due each month?

According to Fly To Fit's 2024 Franchise Disclosure Document, the royalty fee, which is 6% of gross sales, is due monthly. Specifically, it must be paid by the first Tuesday of the following month. Fly To Fit requires franchisees to pay royalty fees via preauthorized bank draft, but they can require an alternative payment method. Gross sales include the total dollar amount of all sales generated through your business for a given period, including, but not limited to, payment for any services or products sold by you, whether for cash or credit. Gross Sales does not include (i) bona fide refunds to customers, (ii) sales taxes collected, (iii) sale of used equipment not in the ordinary course of business, or (iv) sales of prepaid cards or similar products (but the redemption of any such card or product will be included in Gross Sales). All fees are payable only to Fly To Fit (other than the local marketing spend and software subscription charges). All fees are imposed by Fly To Fit and collected by them (other than software subscription charges). All fees are non-refundable. All fees are uniform for all franchisees, although Fly To Fit reserves the right to change, waive, or eliminate fees for any one or more franchisees as they deem appropriate. There are currently no marketing cooperatives, purchasing cooperatives, or other cooperatives that impose fees on you.

For a Fly To Fit franchisee, this means that you need to calculate your gross sales for each month and ensure that 6% of that amount is available for payment by the first Tuesday of the following month. It is important to understand what constitutes gross sales, as defined in the franchise agreement, to accurately calculate the royalty fee. The FDD specifies what is included and excluded from gross sales, such as refunds, sales taxes, and the sale or redemption of prepaid cards.

It's also important to note that while the royalty fee is currently collected via preauthorized bank draft, Fly To Fit retains the right to change the payment method. Franchisees should stay informed of any changes to payment procedures to avoid late fees or other penalties. While the fees are generally uniform, Fly To Fit has the discretion to modify or waive fees for individual franchisees, although this is not the norm. Franchisees should also be aware that all fees are non-refundable, so it's crucial to manage your business effectively to meet your financial obligations.