Franchise royalty definition
What is the standard definition of a royalty paid by a franchisee to the franchisor?
The standard way of calculating the royalty fee paid by a franchisee to a franchisor is some percentage of gross sales.
In addition, if the franchisor profits by selling product, it would have to disclose that income in its offering circular (UFOC). This allows prospective franchisees to see how much of a cut this franchisor is taking.
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