What is the dependency between the royalty fee and the gross revenue report for Zoomin Groomin?
Zoomin_Groomin Franchise · 2025 FDDAnswer from 2025 FDD Document
The Royalty Fee is calculated based upon Gross Revenues. "Gross Revenues" means the total of all receipts whether cash, credit, checks, bitcoin, or other means of exchange net of any tax, adjustments, credits and allowances actually made in accordance with the Operations Manual. Even though we reserve the right to access your computer system to download sales information, you must provide us with the required Gross Revenue report by 5:00 p.m. every Tuesday for the prior week's activity. The end of each week for Royalty collection purposes is Saturday at midnight.
Source: Item 6 — OTHER FEES (FDD pages 16–20)
What This Means (2025 FDD)
According to Zoomin Groomin's 2025 Franchise Disclosure Document, the royalty fee is directly dependent on the franchisee's gross revenue report. Zoomin Groomin calculates the royalty fee, which is 8% of gross revenue, based on the gross revenue report that franchisees are required to submit weekly. The report must be submitted by 5:00 p.m. every Tuesday, reflecting the prior week's activity, with the week ending on Saturday at midnight. This ensures that Zoomin Groomin receives timely and accurate financial information to calculate the royalty fee.
Even though Zoomin Groomin reserves the right to access the franchisee's computer system to download sales information, the franchisee is still responsible for providing the gross revenue report. This dual reporting mechanism likely serves as a verification process, ensuring accuracy and transparency in the revenue reporting. The royalty fees are paid weekly via electronic funds transfer, so the gross revenue report is essential for determining the amount to be transferred.
Failure to provide accurate and timely gross revenue reports could lead to discrepancies in royalty fee payments, potentially resulting in late fees or audits. Zoomin Groomin also requires franchisees to participate in an electronic funds transfer program, further emphasizing the importance of accurate reporting and timely payments. The franchisor also conducts audits if they suspect under reporting of gross revenues or underpayment by 5% or more.