What is the definition of 'Gross Revenues' for the purpose of calculating the Learningrx royalty fee?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Gross Revenues. "Gross Revenues" means the total of all receipts derived from services or Products sold by you, whether the receipts are evidenced by cash, credit, checks, gift certificates, scrip, coupons, services, property, bartering, or other means of exchange. Gross Revenue excludes only sales tax receipts that you must by law collect from customers and that you actually pay to the government, promotional or discount coupons to the extent that Franchisee realizes no revenue, and employee receipt of services or Products, if free, or any portion not paid for by an employee. Cash income reports from the accounting software, without any deductions for any fees due to collection method, are used to calculate the royalty amounts due each month.
Source: Item 6 — OTHER FEES (FDD pages 13–19)
What This Means (2025 FDD)
According to Learningrx's 2025 Franchise Disclosure Document, "Gross Revenues" is defined as the total income from services or products sold by the franchisee. This includes all forms of payment, such as cash, credit, checks, gift certificates, scrip, coupons, services, property, and bartering. This broad definition ensures that all revenue streams are subject to royalty calculations.
However, the definition of Gross Revenues for Learningrx does allow for a few specific exclusions. Franchisees do not have to include sales tax receipts that they collect and remit to the government. Also excluded are promotional or discount coupons where the franchisee doesn't realize revenue, and the value of free services or products provided to employees, or any portion of services/products not paid for by employees.
Learningrx uses cash income reports from the accounting software, without deductions for collection fees, to calculate royalty amounts due each month. This means that the franchisee must report all income before any deductions for fees associated with payment processing or other collection methods. This ensures that the royalty fee is based on the total revenue generated by the Learningrx center before any expenses are deducted.