BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -There’s another fee you’ll be paying as a franchisee. It’s a royalty. Franchise royalties are usually collected by your franchisor on a monthly basis. Like marketing fees, these fees are based on a percentage of your revenue.

Detailed explanation-2: -In a business format franchise, the franchisor provides to the franchisee not just its trade name, products and services, but an entire system for operating the business.

Detailed explanation-3: -Royalty payments are the franchisor’s source of revenue. Because royalty payments are recurrent, they act as franchisee maintenance expenses. What do they keep? For starters, it covers the franchisor’s fees, but most of the earnings are reinvested to promote the company.

Detailed explanation-4: -A royalty fee is an ongoing fee that a franchisee pays to the franchisor. This fee is usually paid weekly, monthly, or quarterly, and is typically calculated as a percentage of gross sales.

Detailed explanation-5: -Franchising agreements: If a franchisee enters into a franchising agreement, they will be required to make franchise royalty payments on a regular basis. These payments give them the right to use the franchisor’s intellectual property assets, as per the terms of the franchise licensing agreement.