When does My Salon Suite recognize revenue from royalties?

According to the 2025 My Salon Suite Franchise Disclosure Document, royalties, which generally range from 2% to 8% of franchisee sales depending on the brand, are recognized at the time the underlying franchisee's sales occur. This means that My Salon Suite recognizes royalty revenue as its franchisees make sales to their customers. The FDD also specifies that advertising fund revenue for SMF and GTN is included in royalty revenue.

For a prospective franchisee, this means that the royalty payments they make to My Salon Suite are directly tied to their sales performance. The more sales a franchisee makes, the higher the royalty payment will be. This revenue recognition method aligns the franchisor's income with the franchisee's success, incentivizing My Salon Suite to support its franchisees in growing their businesses.

It's important to note that the royalty percentage can vary between 2% and 8%, depending on the specific brand within the My Salon Suite franchise system. Franchisees should clarify the exact royalty percentage applicable to their franchise agreement. Additionally, the inclusion of advertising fund revenue in royalty revenue suggests that a portion of the franchisee's royalty payments may be allocated to advertising and marketing efforts, which benefit the entire franchise network.