How does Bambu record the rebates it receives from distributors?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
The term "Net Revenues" shall mean the total gross revenue derived by Franchisee from the operation of its Bambū shoppe, whether from sales for cash or credit, and irrespective of the collection thereof, including sales of both merchandise and services, but exclusive of all sales taxes, use taxes, gross receipts taxes, and other similar taxes added to the sales price and collected from the customer, and less any bona fide refunds, rebates, discounts, and tips.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, the term "Net Revenues" is defined as the total gross revenue a franchisee derives from their Bambū shoppe. This includes all sales for cash or credit, irrespective of collection, and sales of both merchandise and services. However, this excludes sales taxes, use taxes, gross receipts taxes, and other similar taxes added to the sales price and collected from the customer.
Importantly, the definition of "Net Revenues" also allows for the deduction of any bona fide refunds, rebates, discounts, and tips. This means that when Bambu calculates the royalty fee owed by the franchisee, the franchisee can reduce their gross revenues by the amount of any legitimate rebates they have provided to customers.
This is a standard practice in franchising, as it ensures that franchisees are not paying royalties on revenue they did not actually receive. It also aligns the interests of the franchisor and franchisee, as both parties benefit from accurate and transparent accounting of revenues and deductions.