Simple questions.
1) Is the franchise fee a one time fee, or yearly?
2) Royalty fees are paid by transaction, monthly, or yearly?
Thanks
2007-02-01 07:46:27 · 6 answers · asked by explicted1 1 in Business & Finance ➔ Small Business
I think I am in a better position to answer your question as myself being a Franchise Development Manager for a well-known Italian cafe.
First of all the franchise fees depends on the type of agreement and the franchisor rules. We normally have a 3 year franchise agreement and upon renewal at the end of the agreement period, the franchise fee is cut into half. Any subsequent renewals beyond the next 3 year periods is quarter of the first franchise period. Of course it differs from company to company.
Re. royalty fees, they are calculated upon each transaction payable at the end of every month or the duration worked out between the franchisor and the franchisee.
I hope I have been of some help to you.
Good Luck !!
2007-02-01 07:54:06 · answer #1 · answered by Musharaf 3 · 0⤊ 0⤋
Your franchise fee is a one time fee, then you have yearly maintinance fees that differ from Corporation to Corporation. Check the set-up of the franchise before going much further; some have stipulations that they tell you were to franchise and a minimum number of Franchises you must buy.
2007-02-01 08:33:57 · answer #2 · answered by bdough15 6 · 0⤊ 0⤋
I know another franchise (not to do with icecream) and they get a percentage of the money earned. I guess thats a royalty on sales? Not sure if there was an annual fee. But if your interested in it, you could go to there websites, call them etc and find out what each places policys are.
2016-03-15 03:36:57 · answer #3 · answered by Anonymous · 0⤊ 0⤋
It depends on the franchise.
The franchise fee is usually a one-time fee to build the store. If you build multiple stores, you'll have to pay the franchise fee again.
Royalties can be deducted monthly, weekly, or quarterly. I think most places do it weekly.
2007-02-01 07:50:04 · answer #4 · answered by Anonymous · 0⤊ 0⤋
1-is just paid in the beginning.
2-may be collected monthly or yearly.
The problem is it is off the top, that is, it may be 5% and that sounds small, but 5% of gross is pretty big and there ain't much profit left for you.
2007-02-01 07:50:23 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Thanks for the answers!
2016-08-23 16:49:05 · answer #6 · answered by ? 4 · 0⤊ 0⤋