For Ben Jerrys company-owned stores, when is revenue recognized?
Ben_Jerrys Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company has two company owned scoop shops as noted in b) above. These locations generate net product sales through customers purchasing ice cream and related products at a point in time (the customer transaction represents a single performance obligation that is satisfied in the shop) and are fully functioning scoop shops that mirror our independent franchisees. These shops report all their sales to the Company which appear as Net Product Sales on the Consolidated Statement of Operations. The Company pays all the expenses on behalf of the two locations.
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 89–133)
What This Means (2025 FDD)
According to Ben Jerrys's 2025 Franchise Disclosure Document, revenue from company-owned stores is recognized when customers purchase ice cream and related products. This is considered a single performance obligation that is satisfied at the point of sale in the shop. The document specifies that these company-owned scoop shops function similarly to independently owned franchises. They report all sales to the company, which are then recorded as Net Product Sales on the Consolidated Statement of Operations.
This means that Ben Jerrys recognizes revenue from its company-owned stores immediately upon the completion of a customer transaction. This is a common practice in the retail and food service industries, where goods are exchanged for payment at the point of sale.
For a prospective franchisee, this information provides insight into how Ben Jerrys accounts for revenue in its company-owned operations, which can be helpful for understanding the overall financial structure of the Ben Jerrys franchise system. It also highlights that the company-owned stores operate on a similar business model as the franchised locations.