Work out franchise royalty instantly with clear inputs, formula shown and shareable results.
Ongoing franchise cost is rarely just the royalty. Adding the national marketing levy and fixed technology or support charges typically takes the all-in burden to 8-10% of gross sales, which is the figure to use when modelling outlet profitability.
Total fees
Total = Gross sales x (Royalty % + Marketing levy %) + Fixed fees
Effective rate
Effective % = Total fees / Gross sales x 100
Most systems use gross sales excluding sales tax. Because it is charged before your costs, a royalty is payable even in a loss-making month.
Rarely mid-term. The negotiating window is at signature and at renewal, and territory or multi-unit commitments are the usual levers.