What is a 'Reporting Period' defined as for a Noodles & Company franchise?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
The term "Net Royalty Sales" means the aggregate amount of all sales of food, beverages and other products and merchandise sold and services rendered at or from the restaurant location or otherwise rendered to or for your Noodles & Company restaurant or your use of the Marks, including sales at or away from your Noodles & Company restaurant, whether for cash or credit, and regardless of collection in the case of credit, but excluding: (1) all federal, state or municipal sales or service taxes collected from customers and paid to the appropriate taxing authority; and (2) all bona fide, documented: (a) customer promotional discounts approved by us; (b) refunds; (c) voids; and (d) employee meal discounts. A Reporting Period is defined as each one-week period commencing on Wednesday and ending on Tuesday, or other period as we may determine.
Source: Item 6 — OTHER FEES (FDD pages 19–22)
What This Means (2025 FDD)
According to the 2025 Noodles & Company Franchise Disclosure Document, a 'Reporting Period' is defined as each one-week period commencing on Wednesday and ending on Tuesday. However, Noodles & Company retains the right to modify this period as they determine. This definition is important because several fees, such as the royalty fee and the Marketing Administration Fee (MAF), are calculated and payable based on these reporting periods.
The royalty fee is 5% of Net Royalty Sales and is payable on the first Monday immediately following each Reporting Period. Similarly, the Marketing Administration Fee (MAF) is currently 1.25% of Net Royalty Sales and is also payable on the first Monday after each Reporting Period. These payments are made via automatic electronic withdrawal, so franchisees must ensure funds are available to cover these fees at the end of each reporting period.
The flexibility for Noodles & Company to change the Reporting Period could impact franchisees. While currently defined as a one-week period, any changes could affect the frequency of fee payments and the administrative tasks associated with them. Prospective franchisees should clarify with Noodles & Company the circumstances under which the Reporting Period might be altered and how much advance notice would be provided for such changes. Understanding the stability and predictability of these periods is crucial for financial planning and operational management.