It is correct to say that if a franchisor expects an 8% royalty fee on revenue, the franchisor earns 8 cents on each dollar of revenue the franchisee generates.

Question

Quizplus · Accepted Answer

Shared profits is an important aspect of most franchise arrangements. The franchise agreement will stipulate the percent of revenues that the franchisor will collect from each franchisee. In this example, 8% of each dollar of revenue = 8 cents, or $.08 that will go to the franchisor.

It Is Correct to Say That If a Franchisor Expects