factual
What is the Recruiter Continuing Fee structure for Management Recruiters based on Net Cash In?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
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ITEM 6: OTHER FEES
| Type of fee | Amount | Date Due | Remarks |
|---|---|---|---|
| Recruiter Continuing Fee | The royalty fee is: 9% on the first 500,000 of Net Cash In; 7% on Net Cash In from $500,001 to $1,000,000; 5% on Net Cash In from $1,000,001 to $2,000,000; and 3% on Net Cash In that exceeds $2,000,000. See Note 1. | Payable weekly on Wednesday following collection of Net Cash In. See Note 2. | Net Cash In means the total amount of all accounts receivable which are generated by the Recruiter Services which are collected less only sales and use |
Source: Item 6 — OTHER FEES (FDD pages 16–23)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, franchisees must pay a Recruiter Continuing Fee based on their Net Cash In. Net Cash In is defined as the revenue collected from recruiter services, less sales and use taxes. The Recruiter Continuing Fee is calculated as follows:
- 9% on the first $500,000 of Net Cash In
- 7% on Net Cash In from $500,001 to $1,000,000
- 5% on Net Cash In from $1,000,001 to $2,000,000
- 3% on Net Cash In exceeding $2,000,001
This fee is payable weekly on the Wednesday following the collection of Net Cash In. This structure means that as a Management Recruiters franchise increases its Net Cash In, the percentage paid as a continuing fee decreases, potentially incentivizing higher revenue generation. However, franchisees should carefully consider these fees when projecting their potential earnings and cash flow.
Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only.
It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.