For Benjamin Franklin Plumbing, what is included in the definition of Gross Revenue for royalty calculation purposes?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
(2) "Gross Revenue" means all revenue from the sale of products and services and all other income of every kind related to the Franchised Business, whether for cash, credit, trade, barter or other value and regardless of collection in the case of credit and even if you have contracted with third parties to provide certain of the services, less any bona fide refunds given to customers in the ordinary course of business. Gross Revenue also includes amounts billed to insurance or government programs. Further, Gross Revenue
includes all revenue related to the sale of any products and the performance of any services (whether or not the products or services are approved by us) that are provided using any portion of the Franchised Business in any manner, including the Marks (such as service vehicles, invoices, and uniforms bearing the Marks), the System, Confidential Information, any of the employees of the Franchised Business, or the telephone number of the Franchised Business. Your Gross Revenue will not be reduced on account of any fees or commissions you pay to third parties who refer customers.
Gross Revenue does not include any sales taxes or other taxes you collect from customers and pay directly to the appropriate taxing authority. We reserve the right to modify our policies and practices regarding revenue recognition, revenue reporting, and the inclusion or exclusion of certain revenue from Gross Revenue as circumstances, business practices, and technology change.
Source: Item 6 — OTHER FEES (FDD pages 18–27)
What This Means (2025 FDD)
According to Benjamin Franklin Plumbing's 2025 Franchise Disclosure Document, Gross Revenue encompasses all income derived from the franchised business. This includes revenue from the sale of products and services, as well as any other income, whether received in cash, credit, trade, barter, or other forms of value. This applies regardless of whether payment has been collected for credit transactions or if third parties are contracted to provide certain services. Gross Revenue also includes amounts billed to insurance or government programs.
Specifically, Gross Revenue includes all revenue related to the sale of products and the performance of services, regardless of whether those products or services have been approved by Benjamin Franklin Plumbing. This applies if these products or services are provided using any part of the franchised business, including the use of trademarks, service vehicles, invoices, uniforms, the system, confidential information, employees, or the business's telephone number. However, Gross Revenue will not be reduced by any fees or commissions paid to third parties for customer referrals.
It is important to note that sales taxes or other taxes collected from customers and paid directly to the appropriate taxing authority are excluded from Gross Revenue. Benjamin Franklin Plumbing retains the right to modify its policies regarding revenue recognition, reporting, and the inclusion or exclusion of certain revenue from Gross Revenue as business practices and technology evolve. This means that the definition of Gross Revenue could change over time, potentially impacting the royalty fees owed by the franchisee.