Play It Again Sports Franchise Profits

Updated April 6, 2021.

If you are because a Play Information technology Again Sports franchise, don't get blindsided by these 19 of import franchise fees (from the initial franchise fee, to the royalty fee, to 17 other fees found in Items v and 6 of Play Information technology Over again Sports' 2021 FDD).

You must pay to Play It Again Sports "Initial Fees" to cover the price of goods and services that it provides to you before your Store opens. The Initial Fees include the Initial Franchise Fee and the initial cost of Play Information technology Once again Sports' point-of-sale system and proprietary software.

In addition, the Initial Fees include the cost of any inventory purchased from Play Information technology Once more Sports (optional). Each component of the Initial Fees is described below:

one.  Initial Franchise Fee:  $xv,000 to $25,000

• If you lot are opening a single Store, y'all must pay an "Initial Franchise Fee" of $25,000 to Play It Once more Sports. The Initial Franchise Fee is $15,000 if you are currently opening a second or subsequent Store or if you are an existing franchisee of one of the franchisor'southward other franchised concepts.

• You must sign a separate Franchise Agreement for each Store, and you lot must pay the Initial Franchise Fee for each Store in a lump sum to Play Information technology Once more Sports when you sign the Franchise Agreement. The Initial Franchise Fee is nonrefundable.

ii.  Point-of-Auction (POS) Organization: $17,900 to $twenty,900

• You must utilize in your Store the bespeak-of-auction system (the "POS System") which Play It Again Sports has selected for your Business System, and yous must enter into a Computer Software License Agreement with Play Information technology Again Sports for use of its proprietary software programme (the "Proprietary Software").

• The initial cost of the POS Organisation and Proprietary Software volition range from $17,900 to $twenty,900 for each Shop, which includes the DRS Maintenance Fee. This corporeality is not refundable.

• You will by and large buy the POS System and Proprietary Software immediately earlier you nourish Play It Again Sports' second week of training.

iii.  Initial Inventory:  $60,000 to $100,000

• You must buy the initial inventory of new and used sporting goods and equipment necessary to commence Shop operations. You may buy certain new sporting goods and equipment from Play It Over again Sports or other suppliers.

• When you lot purchase new sporting goods and equipment from Play It Again Sports or other suppliers, your costs will range from $60,000 to $100,000.

• When you buy office or all of your initial inventory of sporting goods or equipment from Play It Again Sports or other suppliers, you must pay the invoice in full at the time you lot place your order.

• Payments for inventory purchased from Play It Again Sports are not refundable. Refunds for payments for inventory purchased from other suppliers will be at the discretion of those suppliers.

• The total amount for your Initial Fees will depend on the goods and services that Play It Over again Sports provides to yous.

4.  Standing Fee:  5% of your "Gross Sales"

• Due Date:  On or before Wednesday of each week for the previous week.

• "Gross Sales" means the total revenues you receive from the sale of goods and services, whether past cash or by check, credit menu or trade, in connection with the Store, less customer refunds and returns and sales or similar taxes. Gross Sales includes any sales permitted though the Internet.

• Gross Sales do not include wholesale transactions from Play It Again Sports franchisees to other Play It Over again Sports franchisees in proficient standing with the franchisor.

• In sure situations, other franchisees may be paying a lower percentage rate for continuing fees than you are. All new franchisees are required to pay the percent rate stated in the disclosure certificate. Notwithstanding, a franchisee with an earlier Franchise Agreement may accept been required to pay a lower pct rate than the stated amount or may be required to pay less upon renewal of their Franchise Agreement.

• In the future, the franchisor may alter the standing fees for new and renewing franchisees unless your Franchise Agreement specifically grants you the correct to renew your Franchise Agreement at a lower rate.

• The franchisor requires you to allow information technology to withdraw continuing and other fees directly from your bank account.

5.  Marketing Fee: $i,500 per year

• Due Date: Due January one of each year.

vi.  Cooperative Advertising: maximum corporeality is 5% of your Gross Sales

• Due Date:  Established by the franchisor or franchisees.

• The franchisor or local Play It Once more Sports franchisees may institute an advertising cooperative in your area. The local advertisement cooperative will plant the corporeality of cooperative advertizement fees.

• If a company-endemic store is a fellow member of your cooperative, it volition take voting power equal to that of franchised stores. Company-owned stores will not have controlling voting ability in any local cooperative.

• In that location are currently no company-owned Play It Again Sports stores.

seven.  Local Marketing Expenses:  minimum corporeality, when combined with cooperative advertisement expenses, is 5% of your Gross Sales

• Due Appointment:  Minimum corporeality must be spent during each agenda year.

• To the extent your annual contributions to cooperative advertisement programs are less than five% of the Gross Sales for your Store, you must conduct additional advertising and marketing activities in your local geographic area.

• Your local ad activities, however, will non eliminate your obligations to contribute to cooperative advertising programs.

• If you practise not spend at least 5% of Gross Sales for the calendar yr for cooperative or local advertising, Play It Again Sports may require that you pay it the difference between what you should have spent for advertising during the agenda year and what yous actually spent, with the money to exist spent on advertizement initiatives in your market in the subsequent year at Play It Again Sports' discretion.

8.  Advertizement Fee: if Play It Once again Sports imposes this fee, you will pay upwards to 2% of your Gross Sales

• Due Date:  If Play It Again Sports imposes this fee, it volition be due before Wed of each week for the previous calendar week.

• Play It Again Sports may, with 60 days' observe, increment your minimum advert expenditures upward to a total of half dozen% of your Store's Gross Sales. Of the half dozen%, upwardly to 1-tertiary (or 2% of Gross Sales) will be paid in the form of an "Advertizement Fee" to Play It Once more Sports for deposit in an Advertising Fund to exist managed by Play It Again Sports. The balance of the six% minimum advert requirement must exist used for cooperative advertising and local advertising.

9.  Transfer Fee:  $10,000

• Due Engagement: Before completion of transfer.

• This fee is payable when the Franchise Agreement or a substantial portion of the avails of the Store or any controlling interest in the franchisee is transferred.

ten.  Audit Expenses:  price and expenses related to audit

• Due Date:  Afterward inspection or audit.

• Payable only if understatement is greater than 2%.

11.  Renewal Fee:  $10,000

• Due Date: 30 days earlier renewal of Franchise Understanding.

12.  DRS Maintenance Fee:  the fee for the term of the current Franchise Agreement is $1,000. Upon renewal, the then-current rate for the fee will be applied.

• Due Appointment:  The fee will be due upon placement of club of the POS Organization, and upon renewal of the Franchise Agreement.

• This fee is for upgrades to the antivirus and database engine software that supports the DRS software and is payable when y'all initially order your POS System and upon renewal of your Franchise Agreement.

thirteen.  Technology Fee:  currently, $0

• Due Appointment:  Periodically, if established.

fourteen.  Remodeling Expenses:  will vary under circumstances

• Due Date:  When incurred.

• You must modernize your Shop upon notice from Play It Once more Sports, although information technology cannot require yous to exercise so more than than in one case every 5 years. The modernization must suit to the standards that Play It Again Sports requires at that time for similarly situated new Play Information technology Once again Sports Stores.

• The scope of modernization may range from simply repainting the Shop to completely refurbishing the entire Shop, including replacement of fixtures, sign supplies, equipment, and POS System.

• Play It Again Sports cannot judge the current costs for a modernization project considering the scope and extent of the modernization will vary based on the then-current make standards, the status of the Store, and the toll of labor and materials at that time.

• You may make these payments in whole or in office to Play Information technology Again Sports' approved tertiary parties and/or preferred vendors. Before yous modernize your Store, y'all must submit your modernization plans to Play It Once more Sports for its approval.

xv.  Insurance:  will vary under certain circumstances

• Due Appointment: When Play Information technology Again Sports requests reimbursement.

• Payable to Play Information technology Over again Sports if yous fail to pay insurance premium and Play It Again Sports pays information technology for you.

16.  Inventory:  volition vary nether certain circumstances

• Due Date:  When incurred.

• You will need to continually replenish your Store inventory (both new and used items).

• Your quarterly costs for inventory volition vary significantly, depending on such factors as seasonal changes in demand and your Store sales, although these costs generally will range from $90,000 to $150,000.

17.  Interest Expenses:  lesser of 18% per year or maximum rate permitted by law

• Due Appointment:  When due.

• Payable if Continuing Fee or other amounts due Play It Again Sports are non timely paid.

eighteen.  Charter Payment:  will vary under certain circumstances

• Due Engagement:  When due.

• Payable if yous sign a lease understanding for the equipment used in your store.

nineteen.  Costs and Attorneys' Fees:  will vary under circumstances

• Due Appointment:  When incurred.

• Play Information technology Once more Sports may recover costs and reasonable attorneys' fees if you lose in a dispute with it.

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Source: https://www.franchisechatter.com/2017/04/15/considering-a-play-it-again-sports-franchise-dont-overlook-these-18-important-franchise-fees/

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