For an Alloy franchise, what is included in the definition of 'Gross Sales'?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
- "Gross Sales" means the total gross revenue from the provision of all products and services sold or performed in, at, from or away from the Alloy Facility, or through or by means of the Franchise Business, whether from cash, check, credit card, debit card, barter or exchange, or other credit transactions, and regardless of collection, and including (a) session fees, membership fees, initiation fees, enrollment fees, processing fees, paidin-full dues, renewal fees, corporate/third party payer fees, monthly dues and any fees or revenue generated and derived during any pre-sales; (b) fees and charges for optional services such as personal training, small group training and other optional programs we design; (c) fees charged to non-members using the Facility's services; and (d) revenue derived from merchandise and product sales. Sales taxes, use taxes, and other similar taxes added to the sales price and collected from the customer and paid to the appropriate taxing authority are deducted from Gross Sales.
On Monday of each week, you must provide us with a report of your Alloy Facility's Gross Sales for the previous week ending Sunday. We may electronically access your computer system to obtain this information, but you must still provide us with this report.
Source: Item 6 — OTHER FEES (FDD pages 15–20)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, Gross Sales are defined as the total gross revenue from all products and services sold or performed at the Alloy facility, or through the franchise business, regardless of the form of payment (cash, check, credit card, etc.) or whether the revenue has been collected.
Specifically, Gross Sales include various fees such as session fees, membership fees, initiation fees, enrollment fees, processing fees, paid-in-full dues, renewal fees, corporate/third party payer fees, monthly dues, and any revenue generated during pre-sales. It also encompasses fees and charges for optional services like personal training, small group training, and other programs designed by Alloy, as well as fees charged to non-members using the facility's services. Revenue from merchandise and product sales is also included in Gross Sales.
However, sales taxes, use taxes, and other similar taxes that are added to the sales price, collected from customers, and paid to the appropriate taxing authority are deducted from Gross Sales. Franchisees are required to provide Alloy with a weekly report of their facility's Gross Sales, and Alloy may also electronically access the franchisee's computer system to obtain this information. This definition is important because many fees payable to Alloy are calculated as a percentage of Gross Sales, such as the Management Fee of 10% of Gross Sales, plus expenses, if Alloy steps in to manage the Franchised Business.