What revenues are excluded from the definition of "Gross Revenues" for a Pump It Up franchise?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
As used in this Agreement, the term "Gross Revenues" means all revenue that you derive from operating the Franchised Business, including, but not limited to, all services and products sold, all video game machine and vending machine proceeds and all amounts that you receive at or away from the Premises, and whether from cash, check, credit and debit card, barter, exchange, trade credit, third-party coupon partners, or other credit transactions.
Gross Revenues will exclude: (i) all federal, state, or municipal sales, use, or service taxes collected from customers and paid to the appropriate taxing authority and will be reduced by the amount of any documented refunds, credits, allowances, and charge-backs provided to customers in good faith; and (ii) any documented contributions (up to a maximum amount set by us) you make to an approved not-for-profit organization in conjunction with a PIU-approved charitable event.
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, "Gross Revenues" encompass all revenue derived from operating the Franchised Business. This includes revenue from services, products, video game and vending machine proceeds, and amounts received both at and away from the premises, regardless of the form of payment (cash, credit, debit, etc.).
However, the definition of Gross Revenues for a Pump It Up franchise specifically excludes certain items. These exclusions include all federal, state, or municipal sales, use, or service taxes collected from customers and remitted to the appropriate taxing authority. Additionally, the definition allows for a reduction by the amount of any documented refunds, credits, allowances, and charge-backs provided to customers in good faith.
Gross Revenues also exclude any documented contributions (up to a maximum amount set by Pump It Up) made to an approved not-for-profit organization in conjunction with a Pump It Up-approved charitable event. This exclusion provides an opportunity for franchisees to engage in charitable activities without impacting their royalty obligations, subject to franchisor approval and limits.
These exclusions are important for prospective franchisees to understand, as they directly impact the calculation of royalties and other fees owed to Pump It Up. Franchisees should ensure they maintain proper documentation of taxes collected, customer refunds, and charitable contributions to accurately report Gross Revenues and avoid overpayment of fees.