Considering a Pet Butler Franchise? Don’t Overlook These 28 Important Franchise Fees

If you are considering a Pet Butler franchise, don’t get blindsided by these 28 important franchise fees (from the initial franchise fee, to the royalty fee, to 26 other fees found in Items 5 and 6 of Pet Butler’s 2020 FDD).

1.  Initial Franchise Fee:  $12,500

• To acquire a franchise for a Franchised Business, you must pay an initial franchise fee of $12,500 for a Territory containing up to 50,000 single-family dwelling units (“SFDUs”).

• If you wish to obtain a Territory of more than 50,000 SFDUs, and Pet Butler approves, you must pay Pet Butler an additional fee of $0.25 for each SFDU over 50,000 SFDUs.

• 50% of the initial franchise fee due under the Franchise Agreement is due and payable when you sign the Franchise Agreement and the remaining 50% is due before you attend the initial training program.

• In addition, if you qualify for the Pet Industry Professional Program, Pet Butler will apply $12,500 of the initial franchise fee to start-up expenses that it designates or approves, which may include the initial marketing campaign fee.

• If you elect, and are eligible, to participate in Pet Butler Financing for the initial franchise fee, you will still have to make a down payment of 50% of the initial franchise fee upon your signing the Franchise Agreement. However, the remaining balance of the initial franchise fee may be financed over 5 years.

2.  Marketing Campaign Fees for New Pet Butler Franchise:  $15,000

• If you are purchasing a new Pet Butler franchise, you must pay to Pet Butler the sum of $15,000 for an initial marketing campaign.

• Pet Butler will use all of the fee for marketing and advertising in the Territory and will provide you with assistance with the generation of an initial marketing campaign, which may include the following: direct response advertising, name recognition advertising, and print, electronic and other media advertising.

• For new franchisees, the initial marketing campaign fee is payable in a lump sum when you attend the initial training program. However, if you participate in the Flex Start Program, Pet Butler may allow you to pay the initial marketing campaign fee in more than one installment, depending on the business season and the timing of your commencement of the Franchised Business.

3.  Initial Property Data:  $2,135

• You must pay Pet Butler, or its affiliate, a fee for the collection of initial property data relevant for marketing within your Territory. Pet Butler’s affiliate, SGE, or its designee, will collect and provide the property data to you.

• Based on a Territory size of 50,000 SFDUs, Pet Butler estimates the fee to be $2,135 for a new Territory. This “initial property data fee” is payable in a lump sum when you attend the initial training program and is fully earned and non-refundable.

4.  Initial Supply Package:  generally not more than $3,012

• Pet Butler is the supplier of your initial supply package (consisting of opening inventory and supplies), which you must acquire before your Franchised Business opens. The amount for the initial supply package varies but is generally not more than $3,012.

5.  Royalty:  12% of Gross Sales of the Franchised Business

• Due Date:  Payable weekly on the Wednesday following the end of the reporting week.

6.  Marketing Fund Contributions:  2% of Gross Sales of the Franchised Business

• Due Date:  Payable weekly on the Wednesday following the end of the reporting week.

7.  Regional Marketing Fee:  if established, up to 2% of Gross Sales of Franchised Business

• Due Date:  Payable weekly on the Wednesday following the end of the reporting week.

• Pet Butler does not currently collect a Regional Marketing Fee.

8.  Local Marketing Shortfall:  will vary

• Due Date:  Annually (if incurred).

• If your Local Marketing expenditures are less than the minimum amount required, you must pay Pet Butler the amount of the shortfall and it will contribute such amount to the Fund.

9.  Audit:  cost of inspection or audit

• Due Date:  As incurred.

• If you do not submit required reports or if you understate your Gross Sales of the Franchised Business by 5% or more.

10.  Assignment Fee:  2½% of Gross Sales of the Franchised Business within the 12 months immediately preceding the effective date, but no less than $5,000 and no more than $15,000

• Due Date:  Before consummation of consent to assignment.

• Payable when the Franchise Agreement is assigned.

11.  National Advisory Council Assessment Fee:  not currently charged

• Due Date:  When billed.

• Pet Butler does not currently collect a National Advisory Council Assessment Fee.

12.  Indemnification:  will vary under circumstances

• Due Date:  As incurred.

13.  Interest:  the greater of 1½% per month or 3% over Bank of America Prime Rate, but not above the highest legal rate permitted by applicable law

• Due Date:  When billed.

• Payable on all overdue amounts under the Franchise Agreement.

14.  Invoice Customer Fee (paper billing):  $2.00 per invoice

• Due Date:  When billed.

• If Pet Butler is required to prepare and mail paper invoices, it will charge this fee per invoice.

15.  Management Fee:  $300 per day, plus costs and expenses

• Due Date:  As agreed.

• Upon death or incapacity of franchisee, if requested or if no competent manager is available.

16.  Education Fee:  if required, Pet Butler estimates this cost to be $100 per year

• Due Date:  When billed.

17.  Ongoing/Refresher Training:  not currently charged. If implemented, it will be Pet Butler’s then-current fee (currently, $250 per day).

• Due Date:  When billed.

• If Pet Butler requires that you or your employees attend ongoing and refresher training programs.

• Pet Butler may increase the fee during the term of the Franchise Agreement.

18.  Technology Fee:  not currently charged

• Due Date:  When billed.

19.  Accounting Service Fee:  if required, Pet Butler estimates this cost to be $125 per hour

• Due Date:  When billed.

20.  Insufficient Funds:  $50

• Due Date:  As incurred.

21.  Failure to Report Gross Sales Fee:  currently, $25

• Due Date:  As incurred.

22.  National or Regional Meeting Fee:  currently, $500, plus expenses for the National Meeting. This fee is subject to change.

• Due Date:  As incurred.

23.  Customer Survey Fee:  will vary under the circumstances. Approximately $1.50 per customer.

• Due Date:  As incurred.

24.  Services to Customers:  actual costs incurred

• Due Date:  As incurred.

25.  Taxes:  will vary

• Due Date:  As incurred.

• You are responsible for paying taxes arising out of the operation of your business. You must reimburse Pet Butler for any taxes that it must pay to any state taxing authority on account of either your operation or payments that you make to Pet Butler.

26.  Updated Property Data Fee:  not currently charged

• Due Date:  As incurred.

27.  Various Marketing Materials:  actual costs incurred

• Due Date:  As incurred.

28.  Supplier Testing Fee:  an amount not to exceed the cost of inspection and testing

• Due Date:  As incurred.

• If you request approval of a new product or supplier.