What is the royalty revenue for Bft based on?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
5.2 Royalty Fee. Throughout the Term, Franchisee agrees to pay Franchisor, weekly, without setoff, credit or deduction of any nature, a royalty fee equal to seven percent (7%) of the Gross Sales (as that term is defined in Section 5.3, below) generated by the Studio over the immediately preceding week (the "Royalty" or "Royalty Fee"). 5.3 Gross Sales. "Gross Sales" means the total revenue, in whatever form, generated by the Studio, whether or not in compliance with this Agreement and regardless of receipt, including all revenue generated from the sale and provision of any and all gift cards and other products and services at or through the Studio and all proceeds from any business interruption insurance related to the non-operation of the Studio. "Gross Sales" does not include (a) any sales tax and equivalent taxes that are collected by Franchisee for or on behalf of any governmental taxing authority and paid thereto, or (b) the value of any allowance issued or granted to any client of the Studio that is credited in good faith by Franchisee in full or partial satisfaction of the price of the Approved Products or Approved Services offered in connection with the Studio.
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, franchisees must pay a weekly royalty fee. This royalty is equal to seven percent (7%) of the Gross Sales generated by the studio over the immediately preceding week. This payment is made without any deductions.
Gross Sales are defined as the total revenue generated by the Bft studio, regardless of whether it complies with the agreement or if the revenue has been received. This includes revenue from gift cards, products, and services. It also includes proceeds from business interruption insurance related to the studio's non-operation.
Gross Sales does not include sales tax collected for governmental taxing authorities or the value of allowances issued to clients that are credited in good faith towards the price of approved products or services. This means that Bft franchisees will pay royalties on nearly all revenue streams, but they do not have to pay royalties on sales tax or client allowances.