What sections of the Franchise Agreement relate to the royalty fee structure for Focus Cfo?
Focus_Cfo Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty Fee | None (Note 1) | N/A | Unlike a traditional franchise model, you will not be required to pay any ongoing royalty payments. You will receive a percentage of the revenue associated with clients in your Book of Business as well as a percentage for those services that you directly performed. (FA §4, 8, Att. B) |
(1) Focus CFO has the right to change the compensation policy by giving Franchisees at least 30 days' notice. The current base compensation is as follows: For clients in the Franchisee's Book of Business with a signed PSA dated in months one through thirteen after signing the Franchise Agreement, the Franchisee will receive a base rate of thirty percent (30%) of the CFO Services revenue collected on said clients for the life of the accounts. For clients in the Franchisee's Book of Business with a signed PSA dated in months fourteen through twenty-four after signing the Franchise Agreement, the Franchisee will receive a base rate of twenty-five percent (25%) of the CFO Services revenue collected on said clients for the life of the accounts. For clients in the Franchisee's Book of Business with a signed PSA dated after the Franchisee's twenty-fourth month after signing the Franchise Agreement, the Franchisee
will receive a base rate of twenty percent (20%) of the CFO Services revenue collected on said clients. The base rate on these accounts shall increase as the calendar year-to-date collections on their Book of Business on a territory-by-territory basis reaches the following tiers: $1 - $550,000 = 20%; $550,001 - $1,100,000 = 25%; $1,100,001 - $1,650,000 = 30%; revenue over $1,650,000 = 35%. The compensation policy is found in Attachment B to the Franchise Agreement.
Source: Item 6 — Other Fees (FDD pages 11–13)
What This Means (2025 FDD)
According to Focus Cfo's 2025 Franchise Disclosure Document, unlike a traditional franchise model, Focus Cfo franchisees are not required to pay ongoing royalty payments. Instead, the franchisee receives a percentage of the revenue associated with clients in their Book of Business, as well as a percentage for those services that they directly performed. This information regarding royalty fees can be found in the Franchise Agreement (FA) under sections 4 and 8, as well as Attachment B.
Furthermore, the compensation policy, which dictates the percentage of CFO Services revenue a franchisee receives, is detailed in Attachment B to the Franchise Agreement. For clients signed within the first 13 months, the franchisee receives 30% of the CFO Services revenue. This rate decreases to 25% for clients signed in months 14-24, and to 20% for clients signed after 24 months.
However, the base rate on accounts can increase based on calendar year-to-date collections on their Book of Business. The rate starts at 20% for collections between $1 and $550,000, increasing to 25% for collections between $550,001 and $1,100,000, then to 30% for collections between $1,100,001 and $1,650,000, and finally to 35% for revenue exceeding $1,650,000. Focus CFO also retains the right to change the compensation policy with at least 30 days' notice to franchisees.