How does Stretch Zone recognize revenue from the Media Fund?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
ining per person per day. Revenue is recognized upon completion of the training.
Media Fund Fees:
The Company has established a Media Fund. The Company uses the media funds to create various advertising, marketing and promotional materials deemed beneficial. Media fund revenue is recognized as a percentage of gross sales and is recognized as received throughout the year from the franchisees. An initial amount of $500 per
Source: Item 3 — Franchisee/Debtor's Warranties. (FDD pages 263–364)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, the company recognizes revenue from the Media Fund as a percentage of gross sales. This revenue is recognized as it is received throughout the year from franchisees.
Stretch Zone uses these media funds to develop advertising, marketing, and promotional materials that are deemed beneficial for the franchise system. Additionally, an initial amount of $500 per franchise was required to start the fund. This initial amount is included in deferred revenue.
For a prospective franchisee, this means that a portion of their gross sales will be allocated to the Media Fund, which Stretch Zone manages. The funds are used for marketing purposes to benefit the entire franchise network. The initial $500 contribution is treated as deferred revenue, meaning Stretch Zone recognizes it over time as the related marketing services are provided.