How does Brightstar Care recognize revenue for pre-opening services?

According to Brightstar Care's 2025 Franchise Disclosure Document, revenue recognition for pre-opening services is tied to the delivery of those services. Brightstar Care recognizes revenue over time as the customer simultaneously receives and consumes the benefits of these services. This approach aligns the revenue recognition with the actual provision of services to the franchisee.

Brightstar Care uses an input measure of progress to determine how much revenue to recognize. This means that revenue is recognized based on when the service is performed. Since pre-opening services primarily involve setup and training, revenue is recognized as these activities occur. This method ensures that the revenue recognition matches the effort Brightstar Care puts into providing these services.

For a prospective Brightstar Care franchisee, this means that the fees paid for pre-opening services are not immediately recognized as revenue by Brightstar Care. Instead, the revenue is recognized gradually as Brightstar Care provides the training, manuals, site selection assistance, and help with setting up records. This accounting practice provides a clear and consistent way to match revenue with the services delivered, which is a standard approach in franchise accounting.