Royalty Deficiency

In economics and finance, talk about Royalty or regalía It is talking about the payment that must be made for the fact of using the property of a third party. This term is used especially when talking about patents, works subject to copyright or attribution rights, franchises or even the use of certain natural resources.

The royalty payment must be made to the legal owner of the property, patent or good (material or intellectual) that is being used. Those who want to use it with the objective of generating benefits from its use are obliged to pay it. They can be paid between individuals, companies or even the state (when we talk about natural resources for example).

In many cases, royalties are intended to compensate the owner or author for the use of the property in addition to being legally binding. There are different types of royalties: fixed, variable, on purchases or on sales. The decision to opt for one form or another depends on several factors, including the volume of the business or the territory on which it is going to be applied.

For example, the figure of the franchisor usually puts a royalty to improve the franchise network and support the headquarters. If you want to know all the aspects that are included within the royalty of a franchise, keep reading this article and infórmate.

Is there a royalty in the franchises?

Yes, royalties from franchises they are usually of a fixed rate. The franchisee pays a fixed amount according to the agreed form for the right to be a franchisee and to be able to commercially exploit a well-known brand or product.

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