Primrose Schools FDD Item 6 is the section of the Franchise Disclosure Document that lists every ongoing fee a franchisee will pay after the initial $80,000 franchise fee. For prospective Primrose Schools franchisees investing $743,000 to $8.6 million in a childcare location, this is where the true recurring cost of the franchise relationship becomes clear. At Lopes Law LLC, we routinely review Primrose Schools FDDs for prospective franchisees, and the conversations we have about Item 6 fees are among the most important in the entire engagement.

This guide breaks down exactly what Primrose Schools discloses in Item 6, explains why the combined fee burden can exceed 10% of gross revenues, and walks through the specific line items that every buyer needs to understand before committing capital to a Primrose Schools franchise.

What Is FDD Item 6 and Why Does It Matter for Primrose Schools?

Item 6 of any Franchise Disclosure Document is titled “Other Fees.” It is required by the FTC Franchise Rule (16 C.F.R. Part 436) and must disclose every recurring fee, contribution, or payment obligation the franchisee will owe during the term of the franchise agreement. Item 5 covers the initial fees. Item 6 covers everything that comes after.

For Primrose Schools specifically, Item 6 is critical because the franchise model involves multiple layers of ongoing financial obligation that collectively represent a significant percentage of your gross revenues. When you combine the royalty, the brand fund fee, local advertising minimums, and cooperative advertising contributions, the total ongoing fee burden exceeds 10% of gross revenues before you account for sourcing restrictions, technology fees, or any other operational costs.

Understanding every line item in Item 6 is essential because these fees continue for the entire term of the franchise agreement, which can span 15 to 20 years. Small percentages applied to multi-million-dollar revenue produce large dollar amounts over time.

What Fees Does Primrose Schools FDD Item 6 Disclose?

Primrose Schools’ Item 6 includes a comprehensive fee schedule. Here is a breakdown of the major categories based on publicly available FDD information:

How Does the 7% Royalty Compare to Other Childcare Franchises?

The 7% royalty is the single largest ongoing fee in the Primrose Schools franchise relationship. This royalty is calculated on Gross Revenues, which means it is assessed on every dollar of enrollment revenue regardless of your profitability. Whether your school earns a healthy margin or operates at a loss in a given month, the 7% royalty is owed.

In the childcare franchise sector, royalty rates generally range from 5% to 8%. Primrose Schools’ 7% rate is within this range but toward the higher end. Some competing childcare franchises charge lower royalty rates but may compensate with higher advertising contributions, technology fees, or other charges that achieve a similar total fee burden.

What Is the Brand Fund Fee and Can It Increase?

The Brand Fund Fee is currently 2% of Gross Revenues but can be increased by Primrose Schools at any time up to a maximum of 3% of Gross Revenues. This fee funds national and regional brand-building activities, including marketing campaigns, public relations, digital presence, and brand development.

The ability for the franchisor to increase the Brand Fund Fee unilaterally from 2% to 3% is important to factor into your financial projections. A 1% increase on a school generating $2.63 million in annual revenue (the average per recent FDD data) represents an additional $26,300 per year. Over a 15-year franchise term, that increase alone could cost an additional $394,500.

How Do Item 6 Fees Add Up for a Typical Primrose Schools Location?

To illustrate the real financial impact of Item 6 fees, consider a Primrose Schools location generating $2.63 million in annual gross revenue, which is close to the reported system average.

That is approximately 11.8% to 12.6% of gross revenues going to franchise-related fees before the franchisee pays for staffing, facility costs, curriculum supplies, food, utilities, or any other operating expense. When you factor in the primary operating costs for a childcare center, including labor (which typically represents 50% to 60% of revenue) and occupancy costs (10% to 15% of revenue), the margins available to the owner become significantly tighter than many first-time franchisees expect.

For a complete analysis of what Primrose Schools locations actually earn, see our discussion of Item 19 financial performance representations.

What Should Prospective Primrose Schools Franchisees Watch for in Item 6?

When reviewing Primrose Schools FDD Item 6, focus on these specific areas:

• Fee escalation rights: Identify every fee that the franchisor can increase during the franchise term and the maximum allowed increase. The Brand Fund Fee’s ability to increase from 2% to 3% is one example, but there may be others.
• Gross Revenue definition: Understand exactly what is included in “Gross Revenues” for royalty calculation purposes. Some definitions include all revenue collected, while others may exclude certain categories.
• Technology fee structure: Determine whether technology fees are fixed or subject to increase as new platforms are deployed.
• Transfer and renewal fees: Understand the fees triggered by transfer or renewal, including any facility upgrade requirements.
• Late payment consequences: Know the interest rates and penalties for late fee payments, including whether repeated late payments constitute a default.

Why Legal Review of Item 6 Is Essential

The fees disclosed in Primrose Schools’ Item 6 represent contractual obligations that continue for the full term of the franchise agreement. A franchise attorney can help you model the total fee burden, identify fees subject to increase, evaluate the fee structure against competing childcare franchise systems, and calculate your projected net income after all fees. At Lopes Law LLC, our flat-fee FDD validation review is $3,000 and covers all 23 items. For more on the review process, see what to expect from an FDD review. If you are evaluating your options with an existing franchise, learn about our franchise exit audit.

Frequently Asked Questions About Primrose Schools FDD Item 6

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Last updated: March 12, 2026