How often are franchise royalties collected from Pearce Bespoke franchisees, and when are they recognized as revenue?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
enue is recognized upon the execution of the franchise agreement. This fee is assessed for each additional clothier added to a franchised location.
Franchise Royalties
Franchise royalties are calculated based upon either 10% of franchisee gross revenue or a minimum of $100 per week (as defined in the franchise agreement). In year 2 of operation the minimum fee will increase to $150 per we
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 39)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, franchise royalties are collected from franchisees on a weekly basis. These royalties are based on either 10% of the franchisee's gross revenue or a minimum fee.
The minimum royalty fee starts at $100 per week during the first year of operation. This minimum increases to $150 per week in the second year. By the third year and onward, the minimum weekly royalty fee is $200.
Pearce Bespoke recognizes these franchise royalties as revenue on a weekly basis, specifically for the previous week's sales. This means that the revenue is recorded in the financial statements during the week in which the sales occurred.