How are royalty payments made for a Southern Steer franchise?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
pment Agreement Exhibit E: Sample Release Exhibit F: State Agency/Agents for Service of Process Exhibit G: State-Specific Addendum Exhibit H: Brand Manual Table of Contents Exhibit I: Deposit Agreement Exhibit J: State Effective Dates and Receipt
ITEM. 6 OTHER FEES
| Type of Fee(1) | Amount | Date Due | Remarks |
|---|---|---|---|
| Royalty | Beginning on the third | Wednesday each | The Royalty is based on Gross |
| month from Your | week for the | Revenues from the previous week | |
| Required Opening Date, 6% of annual Gross Revenues from $1.00 to $1,000,000; 5% from $1,000,001 to $2,000,000; and 4% from $2,000,001 and greater.(2). | preceding week. | for each individual Southern Steer Business You operate. Payments are m |
Source: Item 6 — ITEM. 6 OTHER FEES (FDD pages 11–16)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, royalty payments are based on a percentage of gross revenues and are paid weekly via electronic fund transfer (EFT) or automatic withdrawal. The royalty fee is dependent on the amount of gross revenues for each individual Southern Steer business. The franchisee begins paying royalties starting the third month from their required opening date. Southern Steer also reserves the right to designate another day of the week for payment. The gross revenue calculation resets each calendar year.
The royalty structure is tiered based on annual gross revenues. For revenues between $1.00 and $1,000,000, the royalty is 6%. It decreases to 5% for revenues between $1,000,001 and $2,000,000, and further decreases to 4% for revenues exceeding $2,000,001. This tiered structure could incentivize franchisees to increase their sales volume, as the percentage paid to Southern Steer decreases as revenue increases.
Southern Steer also requires franchisees to authorize them to initiate debit entries from their business bank operating account for payments of fees and other amounts owed. Franchisees must ensure funds are available for withdrawal by EFT no later than the payment due date. If a franchisee fails to report their gross revenues in a timely manner, Southern Steer is authorized to debit the franchisee's account for the higher of the fees transferred from the account for the last reporting period or an estimated amount due.