Understanding Royalties: How Cartrepreneur® Fees Are Calculated 💸
Carterpreneurs pay royalties on all sales, with specific rules based on territory ownership and minimum commitments. This article explains how royalties are calculated and when different rates apply.
Summary of Terms:
Minimum Royalty: Weekly committed royalty for each individual territory during the pops season assigned for your territory(ies).
Sales / Revenue: All money collected less tax and tips.
Unowned Territory Sales: Any sales that you received in a territory that is not owned and open (area development) by you as the franchisee.
Owned Territory Sales: Any owner's sales conducted within their owned and opened territories.
In season: Every Cartrepreneur is assigned a season based on a range of weeks during the year. This range could be anywhere from week 9 - week 47.
Off Season: Any weeks of the year that do not fall within the assigned season for your territory.
How Royalties are calculated:
In Season Royalties and fees:
Every week, HQ calculates the carterpreneurs' royalties and fees. All sales in owned territories will be subject to either the standard 5% fee or the minimum rate, whichever is higher. Sales in unowned territories are always subject to the 5% rate, irrespective of sales in owned territories. All sales year round will be subject to the 1% brand and marketing fee. The tech fee will also be applied all year round.
In other words, unowned territory sales no NOT count toward your minimum royalty.
Off Season Royaties and fees:
While we do not require the minimum royalty to be met in the off season, please note that 5% royalties and 1% brand fee will be applied to any sales during this time.
FAQ:
Is there any situation where an event outside of my owned and opened territories counts toward the 5 event minimum royalty waiver?
No.
What is the difference between the royalty and the marketing brand fee?
In additional to royalties a 1% brand and marketing fee is taken on all sales year round.
How do I know if I am "in season" or "off season"?
You can review both your franchise agreement, and / or your offer email to find your in season weeks. If you have difficulty finding that information, submit a help form ticket and the appropriate person will reach out to help you.