When is the monthly Royalty Fee due to the Franchisor for a My Salon Suite franchise?
My_Salon_Suite Franchise · 2025 FDDAnswer from 2025 FDD Document
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- A. Franchise Fee. Franchisee shall pay to Franchisor, upon execution of this Franchise Agreement, a non-refundable initial franchise fee in the amount identified on Attachment A ("Initial Franchise Fee"), The entire Initial Franchise Fee is deemed fully earned upon payment and is not refundable under any circumstances, in consideration of:
- (i) administrative, legal, and other expenses incurred by Franchisor in granting this franchise; and
- (ii) Franchisor's lost or deferred opportunity to enter into this Franchise Agreement with others.
- B. Royalty Fee. Franchisee shall, on or before the tenth (10th) day of each month, pay to Franchisor a monthly royalty fee ("Royalty Fee") equal to two and three-quarters percent (2.75%) of Gross Revenues for the previous month for the first six (6) months that the Franchised Business is open. Beginning the seventh (7th) month through t
Source: Item 23 — RECEIPTS (FDD pages 95–230)
What This Means (2025 FDD)
According to My Salon Suite's 2025 Franchise Disclosure Document, the monthly Royalty Fee is due on or before the tenth (10th) day of each month. The Royalty Fee is calculated based on the Gross Revenues for the previous month. For the first six months the Franchised Business is open, the Royalty Fee is 2.75% of Gross Revenues. From the seventh through the twelfth month, the Royalty Fee increases to 5.5% of Gross Revenues. Beginning with the thirteenth month and continuing for the remainder of the franchise term, the Royalty Fee is the greater of $1,000 or 5.5% of Gross Revenues.
It's important to note that My Salon Suite reserves the right to modify the method or interval for collecting fees with notice to the franchisee, which may be provided via the Manual or any other manner they deem appropriate. This means the due date or payment method could potentially change during the term of the franchise agreement.
Late payments are subject to interest at a rate of 1.5% per month or the maximum rate permitted by law, calculated from the original due date until the payment is made in full. Additionally, My Salon Suite may charge a late fee of $50 for each day the Royalty Fee payment is late. If a payment is unsuccessful due to insufficient funds or a similar event, a fee of $100 per occurrence will be charged. These late payment terms are fairly standard in the franchise industry, as franchisors need to ensure timely payments to maintain their own financial obligations and support the franchise system.