Are promotional allowances included in Body20's definition of Gross Sales?

According to Body20's 2025 Franchise Disclosure Document, the brand's definition of Gross Sales does include promotional allowances. Gross Sales encompasses all revenue received from operating a Body20 studio, irrespective of the payment method (cash, credit card, etc.) or when the services are provided. This broad definition includes promotional allowances or rebates paid to the franchisee for purchasing products/supplies or referring customers.

However, the definition of Gross Sales for Body20 specifically excludes (i) any bona fide returns and credits actually provided to customers and (ii) any sales or other taxes collected from customers that are paid directly to the appropriate taxing authority. This distinction is important for franchisees to understand, as it clarifies what revenue is subject to royalty fees and other calculations based on Gross Sales.

For a prospective Body20 franchisee, understanding the components of Gross Sales is crucial for accurate financial planning and reporting. Franchisees should ensure their accounting practices align with Body20's definition to avoid discrepancies in royalty payments and financial reporting. It is also important to note that while Gross Sales figures are provided in the FDD, these figures do not reflect the costs of sales, operating expenses, or other costs that must be deducted to determine net income or profit.