Is the royalty fee for Direct-Pay Students refundable to a Gokhale Method franchisee?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
- 5.3. Royalty Fee Direct Pay. For Direct-Pay Students you agree to pay us a non-refundable royalty ("Royalty") during the Term in accordance with our Royalty Schedule in effect as of the time of payment. The Royalty Schedule in effect as of the signing of this Agreement is included in the annexed Exhibit A and is subject to change from time to time in our reasonable discretion upon thirty (30) days' notice.
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
According to the 2024 Gokhale Method Franchise Disclosure Document, royalty fees paid by franchisees for Direct-Pay Students are non-refundable. Direct-Pay Students are those who pay the franchisee directly in cash, by paper check, or via a credit card system at the franchisee's facility.
This means that once a Gokhale Method franchisee pays the royalty fee for these students, they cannot get a refund, regardless of the circumstances. The royalty schedule, which details the specific amounts, is included as Exhibit A to the Franchise Agreement and can be changed at Gokhale Method's discretion with thirty days' notice.
This non-refundable policy is a standard practice in franchising, as royalty fees are typically considered compensation for the ongoing use of the franchisor's system, brand, and support. Prospective franchisees should carefully consider this non-refundable aspect when evaluating the financial implications of investing in a Gokhale Method franchise.