How is the monthly Royalty Fee determined for a Kitchen Solvers franchise?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
ormly imposed and are not refundable.
- (2) You must pay us a monthly Royalty Fee equal to the greater of: (i) the Monthly Minimum Fee (as provided in Table 1 below), or (ii) a specified percentage of your monthly Gross Sales (as provided in Table 2 below).
| Table 2 | | |---|---| | | | | $0 to $50,000 | 6% | | $50,001 to $75,000 | 5.5% | | $75,001 to $100,000 | 5% | | $100,001 to $125,000 | 4.5% | | $125,001 to $175,000 | 4% | | $175,001 to $225,000 | 3.5% | | $225,001 to $275,000 | 3% | | $275,001+ | 2.5% | | Table 2 | | | Monthly Gross Sales | Royalty Fee Percentage | | $0 to $50,000 | 6% | | $50,001 to $75,000 | 5.5% | | $75,001 to $100,000 | 5% | | $100,001 to $125,000 | 4.5% | | $125,001 to $175,000 | 4% | | $175,001 to $225,000 | 3.5% | | $225,001 to $275,000 | 3% | | $275,001+ | 2.5% | "Gross Sales" includes the total revenues and receipts from the sale of all products and services sold through your KITCHEN SOLVERS Business whether under any of the Trademarks or otherwise and whether the products or services are authorized or unauthorized by us. Gross Sales does not include sales tax.
We participate in the International Franchise Association's Vet-Fran Program and offer qualified individuals honorably discharged from any branch of the U.S. Military who request at the time of signing the Franchise Agreement, a discount of 50% off of your Royalty Fee for the first 6 months of operations.
- (3) You must spend 5% of your expected annual gross sales on localized and digital marketing efforts, unless we approve otherwise in writing.
Source: Item 6 — OTHER FEES (FDD pages 13–16)
What This Means (2025 FDD)
According to Kitchen Solvers's 2025 Franchise Disclosure Document, the monthly Royalty Fee is determined by whichever is greater: a Monthly Minimum Fee or a percentage of monthly Gross Sales. The Monthly Minimum Fee is dependent on how long the business has been operating. For the first 6 months, the Monthly Minimum Fee is $0. From months 7-12, it is $300. From months 13-24, it is $600, and after 24 months, it increases to $900.
The percentage of Gross Sales used to calculate the Royalty Fee varies depending on the amount of sales. If monthly Gross Sales are between $0 and $50,000, the Royalty Fee is 6%. For sales between $50,001 and $75,000, the fee is 5.5%. Sales between $75,001 and $100,000 incur a 5% fee. For sales between $100,001 and $125,000, the fee is 4.5%. Sales between $125,001 and $175,000 incur a 4% fee. If sales are between $175,001 and $225,000, the fee is 3.5%. For sales between $225,001 and $275,000, the fee is 3%, and for sales exceeding $275,001, the Royalty Fee is 2.5%.
For a prospective Kitchen Solvers franchisee, this means that the Royalty Fee will fluctuate based on their sales performance and the duration of their business operation. In the initial months, the minimum fee is waived, providing some financial relief. However, as the business matures, franchisees need to be aware of the increasing minimum fee and how their sales volume impacts the percentage-based royalty. Franchisees should carefully project their expected sales and consider these royalty obligations in their financial planning.
It's also worth noting that Kitchen Solvers offers a discount to veterans, reducing the Royalty Fee by 50% for the first 6 months of operation. This can be a significant benefit for eligible veterans starting a Kitchen Solvers franchise. Additionally, "Gross Sales" includes all revenues from products and services sold through the Kitchen Solvers business, whether authorized or unauthorized by the franchisor, but does not include sales tax.