Is revenue derived from merchandise sales included in Alloy's Gross Sales calculation?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
B. "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 Facility, or through or by means of the Business, whether from cash, check, credit card, debit card, barter or exchange, or other credit transactions, and regardless of collection, and including (a) class fees, membership fees, initiation fees, enrollment fees, processing fees, paid-in-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.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, gross sales include revenue from merchandise sales. The document defines "Gross Sales" as the total gross revenue from all products and services sold or performed in, at, from, or away from the Facility, or through or by means of the Business, regardless of collection method. This encompasses various fees and charges, including class fees, membership fees, and revenue derived from merchandise and product sales.
For a prospective Alloy franchisee, this means that all revenue generated from merchandise sales at their facility contributes to their total gross sales figure. This figure is important because it is used to calculate royalty fees and other financial obligations to Alloy.
However, sales taxes, use taxes, and other similar taxes added to the sales price, collected from the customer, and paid to the appropriate taxing authority are deducted from Gross Sales. This ensures that franchisees are not paying royalties on taxes they collect on behalf of the government.