Under the Batteries Plus Bulbs Franchise Agreement, what constitutes 'Net Revenues'?
Batteries_Plus_Bulbs Franchise · 2025 FDDAnswer from 2025 FDD Document
- BP FA (FTC) 03/28/25 D. "Net Revenues" means the aggregate amount of all sales of goods and services (including service charges in lieu of gratuity), whether for cash, on credit or otherwise, made or provided at or in connection with the Store, including off-premises sales and monies derived at or away from the Store. The term "Net Revenues" does not include: (1) any federal, state, municipal or other sales, value added or retailer's excise taxes paid or accrued by Franchisee; and (2) adjustments for net returns on salable goods and discounts allowed to customers on sales. Net Revenues will not be adjusted for uncollected accounts.
For purposes of the Royalty and Service Fee (as defined in Section 9(B) below), the sale is made at the earlier of delivery of the product or service, or receipt of payment.
Source: Item 22 — Contracts (FDD page 80)
What This Means (2025 FDD)
According to the 2025 Batteries Plus Bulbs Franchise Agreement, "Net Revenues" is defined as the total income from all sales of goods and services at the store, whether the payment is in cash, credit, or another form. This includes sales made both at the store location and off-premises, as well as any service charges collected in place of gratuity.
However, the definition of "Net Revenues" specifically excludes certain items. Franchisees do not include federal, state, municipal, or other sales, value-added, or retailer's excise taxes that they pay or accrue. Additionally, adjustments for net returns on salable goods and discounts provided to customers are also excluded from the calculation of Net Revenues. It is important to note that Net Revenues will not be adjusted to account for uncollected customer accounts.
For the purpose of calculating the Royalty and Service Fee for Batteries Plus Bulbs, a sale is considered to have occurred at the earlier of when the product or service is delivered or when payment is received. This definition is important because many of the franchisee's financial obligations to Batteries Plus Bulbs, such as the 1% National Marketing Fund fee, are calculated as a percentage of Net Revenues.