How often is the 8% of Gross Sales royalty fee paid by Kidokinetics franchisees?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
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- Royalty Fee: The obligation to pay Royalties begins upon completion of your initial training. You will be required to pay the greater of 8% of Gross Sales or the "Minimum Royalty" (described below). You will pay 8% of Gross Sales on a weekly basis. At the end of the month, if the Minimum Royalty amount is greater than the total weekly Royalties paid that month, you will pay us the difference in order to meet your Minimum Royalty obligation. You will receive a grace period ("Grace Period") before you are required to begin paying Minimum Royalties. The Grace Period will be for 90 days beginning on the day you successfully complete the initial training and will expire after 90 days. If you purchase multiple franchises at the same time, you will receive an increased Grace Period for your second through fourth franchises as summarized below.
Source: Item 6 — OTHER FEES (FDD pages 13–17)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, franchisees are required to pay a royalty fee that is the greater of 8% of Gross Sales or a Minimum Royalty. The 8% of Gross Sales is paid on a weekly basis. At the end of each month, Kidokinetics compares the total weekly royalties paid to the Minimum Royalty amount. If the Minimum Royalty is greater than the total weekly royalties paid, the franchisee must pay the difference to meet the Minimum Royalty obligation.
Kidokinetics franchisees receive a grace period of 90 days after completing initial training before they are required to pay Minimum Royalties. If a franchisee purchases multiple franchises simultaneously, the grace period is extended for the second through fourth franchises.
The Minimum Royalty varies based on the timeframe of operation. For the first 12 months after the grace period, the Minimum Royalty is $600 per month. From months 13 to 24, it increases to $800 per month, and from month 25 onward, the Minimum Royalty is $1,000 per month.