Does Ledgers generate revenue from royalty fees?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company generates revenue from three primary sources: (1) franchise fees and area representative sales, (2) royalty fees generated from franchisees and (3) referral fees earned from vendors.
Monthly franchise royalties (the greater of 14% of gross receipts or the annual minimum as outlined in the executed franchise agreement) and monthly advertising fees (3% of gross revenues) pursuant to the franchise agreements, are recognized monthly at a point in time consistent with the period in which the franchisee sales are generated.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, the company does generate revenue from royalty fees. Ledgers' revenue comes from three primary sources: franchise fees and area representative sales, royalty fees from franchisees, and referral fees from vendors. Franchisees are obligated to pay monthly royalty fees, which are calculated as the greater of 14% of gross receipts or the annual minimum outlined in the franchise agreement.
Specifically, the FDD states that for the year ending December 31, 2024, Ledgers generated $36,056 in royalty fees. In 2023, the royalty fees totaled $37,528, and in 2022, they amounted to $49,019. This demonstrates that royalty fees are a consistent and significant component of Ledgers' revenue stream.
Furthermore, franchisees must submit a monthly Royalty Report to Ledgers by the 10th day following the end of each month to calculate the royalty payments owed. These royalty payments are also due on the 10th day of each month, and Ledgers will draft the payment from the franchisee's account on that day. This consistent collection of royalty fees ensures a steady income stream for Ledgers, while also obligating franchisees to meet these regular financial commitments.