How are credit sales treated when calculating Gross Revenue for a Big Blue Swim School?
Big_Blue_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
Each charge or sale upon credit will be treated as a sale for the full price on the day the charge or sale is made, irrespective of when you receive payment (whether full or partial, or at all) on that sale. Revenue from gift/loyalty/stored-value/affinity "cards" and similar items we approve for offer and sale at BIG BLUE Swim Schools, whether maintained on an App, on another electronic medium, or in another form (together, "Loyalty Program Media"), is included in Gross Revenue when the Loyalty Program Media are used to pay for services and products (although we may collect our fees due on that revenue when the Loyalty Program Media are acquired by the customer). Your School may not issue or redeem any coupons or Loyalty Program Media unless we first approve in writing their form and content and your proposed issuing and honoring/redemption procedures. We may grant or withhold our approval as we deem best.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to the 2025 FDD, Big Blue Swim School treats credit sales as sales for the full price on the day the charge is made, regardless of when or if payment is actually received. This means that even if a customer pays for services or products using credit and does not fully pay their bill, the franchisee is still responsible for paying fees based on the full sale amount.
This policy impacts how the franchisee calculates Gross Revenue, which is used to determine fees such as the Software License Fee and potentially Cooperative dues. The Software License Fee is up to two percent of the School's Gross Revenue. If a Cooperative is established in the franchisee's area, they may be required to contribute up to four percent of the School's Gross Revenue to the Cooperative.
Additionally, revenue from gift, loyalty, stored-value, and affinity cards is included in Gross Revenue when these cards are used to pay for services and products. However, Big Blue Swim School may collect its fees due on that revenue when the loyalty program media are acquired by the customer. Franchisees must obtain written approval from Big Blue Swim School before issuing or redeeming any coupons or loyalty program media.