How does the minimum weekly royalty payment change for a Pearce Bespoke franchise after Year 4?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
on of the Franchise Agreement, the Minimum Royalty Payment schedule is as follows:
| Period Following Original | Minimum Royalty Payment |
|---|---|
| Opening Date | |
| Year 1 | $100 per week |
| Year 2 | $150 per week |
| Year 3 | $200 |
Source: Item 12 — TERRITORY (FDD pages 27–29)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, the minimum weekly royalty payment increases over the first four years of operation. In Year 1, the minimum weekly royalty payment is $100. It then increases to $150 per week in Year 2, and $200 per week in Year 3.
After Year 4, the minimum weekly royalty payment changes to a 10% increase over the previous year's minimum. This means that in Year 5, the minimum weekly royalty payment will be $220 per week ($200 + 10% of $200). This escalating minimum royalty payment structure is designed to ensure that franchisees are incentivized to grow their business and increase their sales over time.
For a prospective Pearce Bespoke franchisee, this escalating minimum royalty payment schedule means that they need to plan for increasing royalty obligations as their franchise matures. It's crucial to factor this into their financial projections and ensure that their business can generate sufficient revenue to cover these increasing costs. While the 10% increase provides some predictability, franchisees should be prepared for potential fluctuations in their business and ensure they have a buffer to cover these minimum payments, even during slower periods.