What is included in the definition of 'Gross Sales' for a 360 Painting franchise?

According to 360 Painting's 2025 Franchise Disclosure Document, "Gross Sales" is defined as the total of all monies and receipts derived in connection with the business. This is a standard way that franchisors calculate gross sales, as it is comprehensive and easy to track.

However, the definition of Gross Sales for a 360 Painting franchise does not include a few specific items. These exclusions are (i) promotional allowances or rebates paid to the franchisee in connection with its purchase of products or supplies; (ii) sales, use, merchants' or other taxes measured on the basis of the gross revenues of the business imposed by governmental authorities directly on sales or use and collected from customers, if the taxes are added to the selling price of your goods and services and are in fact paid by you to the appropriate governmental authorities; or (iii) the value of any coupons duly issued and approved by you, or any bona fide discounts or customer refunds approved by us.

These exclusions are fairly typical in franchise agreements. Excluding taxes that are collected and remitted ensures that franchisees are not paying royalties on money that simply passes through their hands. Similarly, excluding approved coupons, discounts, and refunds ensures that franchisees are not penalized for offering promotions or addressing customer service issues. Promotional allowances and rebates are also excluded, which is a common practice to avoid franchisees paying royalties on money they never actually received as revenue.