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[Music] good afternoon my name is jeff thompson im a senior partner in the law firm of the franchise and business law group ive been practicing franchise law for more than 35 years today im going to talk to you about the fees that you have to establish as a franchisor were going to look at your initial fee were going to look at the royalty you will charge and well look at your advertising fee and then a category called other fees looking first at the initial fee the initial fee is important but it isnt designed for you to make money on it isnt a profit center what youre trying to do is set the initial fee to cover your costs and those costs involve the professional fees of the attorney and the accountant itll cover your marketing costs putting together the materials and websites related to it and it will also cover your travel and your own salary or the cost for you to get that franchise sold you want all of those costs covered but youre not trying to make a profit out of t