What is included in the 'Gross Revenue' calculation for a Bft studio?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
- "Gross Revenue" means the total revenue generated by a given Studio, including all revenue generated from the sale and provision of any and all approved services at, from, or otherwise through, that Studio. Gross Revenue excludes sales tax (that the Studio owner must pay directly to the appropriate taxing authority). Please note, Gross Revenue is defined differently than how "Gross Sales" is defined in the Franchise Agreement, and as such, the amount of Royalty fees you pay under the Franchise Agreement may be different than if applied to Gross Revenue data provided below.
- "Fees" means Gross Revenue attributed to fees charged by Studios, such as set up fees, cancellation fees, monthly freeze fees, and enhancement fees.
- "Memberships" means Gross Revenue attributed to down payments and recurring dues for Studio memberships and membership add-ons.
- "Products" means Gross Revenue attributed to retail products sold by Studios.
- "Services" means Gross Revenue attributed to services that Studios provide, such as personal training services, drop-in fees, and studio class packages.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 67–75)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, Gross Revenue is defined as the total revenue generated by a studio from all approved services. This includes revenue from memberships, services, fees, and products, but excludes sales tax. Memberships include down payments and recurring dues. Services include personal training, drop-in fees, and class packages. Fees include set up, cancellation, monthly freeze, and enhancement fees. Products refers to revenue from retail product sales.
It is important to note that Bft defines Gross Revenue differently than Gross Sales in the Franchise Agreement. This means the royalty fees a franchisee pays may differ from what would be calculated using the Gross Revenue data provided in the FDD. Prospective franchisees should understand this distinction and how it impacts their financial obligations.
The FDD provides financial performance representations based on Gross Revenue for qualified studios and new studios. For example, the average Gross Revenue for new studios in their first month of operation was $12,605, based on data from 21 studios. Understanding what constitutes Gross Revenue is crucial for interpreting these financial performance representations accurately and assessing the potential financial performance of a Bft franchise.