Are refunds given to customers deducted from Gross Revenues for an Augusta Lawn Care franchise?
Augusta_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
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- As used in the Franchise Agreement, "Gross Revenues" means the total selling price of all services and products sold at or from your Augusta Lawn Care Business (not adjusted for credit card fees), including the full value of any gift certificate redeemed at your Augusta Lawn Care or coupon sold for use at your Augusta Lawn Care (fees retained by or paid to third-party sellers of such gift certificates or coupons are not excluded from calculation), and all income and revenue of every other kind and nature related to the Augusta Lawn Care operation, whether for cash or credit, but excluding taxes collected from customers and paid to taxing authority, and reduced by the amount of any documented refunds, credits, allowances, and chargebacks the Business in good faith gives to customers.
Source: Item 6 — OTHER FEES (FDD pages 12–14)
What This Means (2025 FDD)
According to Augusta Lawn Care's 2025 Franchise Disclosure Document, customer refunds are deducted from gross revenues. Gross Revenues are defined as the total selling price of all services and products sold by the Augusta Lawn Care business. This includes the full value of any gift certificates redeemed or coupons sold for use at the franchise.
However, Gross Revenues exclude taxes collected from customers and paid to a taxing authority. The definition of Gross Revenues is reduced by the amount of any documented refunds, credits, allowances, and chargebacks that the Augusta Lawn Care business gives to customers in good faith.
This means that an Augusta Lawn Care franchisee only pays royalties on the actual revenue they retain after any refunds or credits are issued. This is a common practice in franchising, as it ensures that franchisees are not paying royalties on revenue they did not ultimately receive.