How often does Benjamin Franklin Plumbing recognize rebates received from third-party vendors?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
ber 31, 2024, 2023 and 2022, respectively, in other revenues on the consolidated statements of operations.
Obligations arising for returns, refunds, and other assurance warranties are infrequent and are not significant to the consolidated financial statements for the years ended December 31, 2024, 2023 and 2022.
Revenue is recognized net of any taxes collected from customers which are subsequently remitted to taxing authorities. These taxes are recorded as a liability when the amounts are billed
Source: Item 22 — CONTRACTS (FDD pages 87–88)
What This Means (2025 FDD)
According to Benjamin Franklin Plumbing's 2025 Franchise Disclosure Document, rebates from third-party vendors are recognized as revenue as they become due. These rebates are provided in return for Benjamin Franklin Plumbing maintaining a buying program that connects the vendors with the company's franchisee customers. The FDD states that these rebates are generally recognized on a monthly basis. The rebates are calculated as a percentage of third-party sales.
For a prospective Benjamin Franklin Plumbing franchisee, this means that a portion of their revenue may be derived from rebates received from vendors participating in the company's buying program. These rebates are not a fixed amount but rather depend on the franchisee's sales of the vendor's products or services. The franchisor recognizes these rebates as revenue on a monthly basis, which could provide a consistent, albeit variable, income stream for both the franchisor and franchisee.
For the years ended December 31, 2024, 2023 and 2022, Benjamin Franklin Plumbing recognized $11,177, $15,723 and $15,906 of rebates in other revenue on the consolidated statements of operations. This demonstrates the potential significance of these rebates as a revenue source for the company. Franchisees should inquire about the specifics of the buying program, including which vendors participate, the percentage of sales that are rebated, and any requirements for franchisees to participate in the program.