Are promotional allowances included in the Gross Sales calculation for a Beem Light Sauna franchise?
Beem_Light_Sauna Franchise · 2025 FDDAnswer from 2025 FDD Document
(b) Gross Sales. "Gross Sales" means all revenue that you receive or otherwise derive from operating the Studio, whether from cash, check, credit or debit card, gift card or gift certificate, or other credit transactions, and regardless of collection or when you actually provide the products or services in exchange for the revenue.
If you receive any proceeds from any business interruption insurance applicable to loss of revenue at the Studio, there shall be added to Gross Sales an amount equal to the imputed Gross Sales that the insurer used to calculate those proceeds.
Gross Sales includes promotional allowances or rebates paid to you in connection with your purchase of products or supplies or your referral of customers.
Gross Sales does not include (i) any bona fide returns and credits that are actually provided to customers and (ii) any sales or other taxes that you collect from customers and pay directly to the appropriate taxing authority.
You may not deduct payment provider fees (i.e., bank or credit card company fees and gift card vendor fees) from your Gross Sales calculation.
Source: Item 23 — RECEIPT (FDD pages 71–230)
What This Means (2025 FDD)
According to Beem Light Sauna's 2025 Franchise Disclosure Document, Gross Sales include promotional allowances or rebates paid to the franchisee in connection with their purchase of products or supplies or their referral of customers. Gross Sales is defined as all revenue that the franchisee receives or derives from operating the studio, whether from cash, check, credit or debit card, gift card or gift certificate, or other credit transactions, regardless of collection or when the products or services are provided in exchange for the revenue.
This means that any promotional allowances or rebates a Beem Light Sauna franchisee receives for purchasing products or supplies, or for referring customers, must be included when calculating Gross Sales. This is important because the Royalty Fee, which is 8% of Gross Sales, is directly impacted by this calculation.
Items that are not included in Gross Sales are bona fide returns and credits actually provided to customers, and any sales or other taxes that you collect from customers and pay directly to the appropriate taxing authority. Payment provider fees (i.e., bank or credit card company fees and gift card vendor fees) may not be deducted from your Gross Sales calculation.