How is the Royalty fee paid to Pump It Up?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Due Date | Remarks | |
|---|---|---|---|
| Royalty (1), (2), (3) | 6% of Gross Revenues | On or before the 7th day of each month. We have the right to modify when and how Royalties are due and payable. | The royalty is based you’re your Gross Revenues in the preceding month, and is payable to us by an automatic, electronic debit from your business checking account. |
| Brand Fund Contribution (1), (3), (4) | Currently 2% of Gross Revenues per fiscal period. We may increase your periodic contribution to the Brand Fund to an amount up to 3% of Gross Revenues. | On or before the 7th day of each month. We have the right to modify when and how the Brand Fund Contribution is due and payable. | Your contribution to the Brand Fund is in addition to your own expenditures for Local Store Marketing. The Brand Fund contribution is payable to us by an automatic, electronic debit from your business checking account. |
NOTES:
- (2) "Gross Revenues" means all revenue that you derive from operating the Franchised Business, including, but not limited to, all services and products sold, all video game machine and vending machine proceeds, and all amounts that you receive at or away from the Premises, and whether from cash, check, credit and debit card, barter, exchange, trade credit, third-party coupon providers or other credit transactions. Gross Revenues excludes all federal, state, or municipal sales, use, or service taxes collected from customers and paid to the appropriate taxing authority and will be reduced by: (i) the amount of any documented refunds, credits, allowances, and charge-backs provided to customers in good faith; and (ii) any documented contributions (up to a maximum amount set by us) you make to an approved not-for-profit organization in conjunction with a PIU approved charitable event.
- (3) You must sign any documents we require to authorize us to electronically debit your business checking account or Electronic Depository Transfer Account ("EDTA") automatically for the Royalty, Brand Fund contributions, late fees, interest and any other amounts. Our current form of EDTA documents are attached as Exhibit 3 to the Franchise Agreement. We will debit the EDTA on the dates that payments are due. If you fail to report Gross Revenues of the Franchised Business, we may debit your EDTA for 120% of the highest monthly Royalty and Brand Fund contribution that we previously debited from your EDTA. If we have not previously debited your EDTA for Royalty and Brand Fund contributions, we will determine the amount to debit in our sole discretion based on Royalty and Brand Fund contributions made by other franchisees. Once we determine the amount you actually owe to us, we will debit the EDTA the difference, or we will apply a credit towards your next payment.
Source: Item 6 — OTHER FEES (FDD pages 15–21)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, the royalty fee is 6% of gross revenues, due on or before the 7th day of each month. Pump It Up has the right to modify when and how royalties are due and payable. The royalty payment is based on the franchisee's gross revenues in the preceding month. Payment to Pump It Up is made via an automatic, electronic debit from the franchisee's business checking account.
Gross revenues include all revenue derived from operating the franchised business, including services and products sold, video game and vending machine proceeds, and amounts received at or away from the premises, whether from cash, check, credit/debit card, barter, or other credit transactions. Gross revenues exclude sales, use, or service taxes collected from customers and paid to the appropriate taxing authority. Gross revenues will be reduced by documented refunds, credits, allowances, and charge-backs provided to customers in good faith, and any documented contributions (up to a maximum amount set by Pump It Up) made to an approved not-for-profit organization in conjunction with a Pump It Up approved charitable event.
To authorize electronic debits for royalties, brand fund contributions, late fees, interest, and other amounts, franchisees must sign required documents allowing Pump It Up to automatically debit their business checking account or Electronic Depository Transfer Account (EDTA). If a franchisee fails to report gross revenues, Pump It Up may debit the EDTA for 120% of the highest monthly royalty and brand fund contribution previously debited. If there is no prior debit history, Pump It Up will determine the debit amount based on royalty and brand fund contributions made by other franchisees. Once the actual amount owed is determined, Pump It Up will debit the difference or apply a credit towards the next payment.