Can I deduct sales of trade fixtures from Gross Revenue for Amorino?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
performed at the Franchised Location or elsewhere, and all other income of every kind and nature related to the Franchised Business, less any authorized discounts (collectively, "Gross Revenue"). Revenue collected from customers in the form of sales tax, federal, state, county, or city taxes, excise tax, or other similar tax collected from customers that you owe to governmental entities must be reported to us, but is excluded from Gross Revenue for the purpose of computing the royalty fee. In addition to taxes, as described in the previous sentence, the following may also be deducted from Gross Revenue: (a) The selling price of any goods returned by customers or the price charged for any services provided to customers to the extent you give any credit, discount, refund or similar allowance but an exchange of merchandise does not result in an exclusion except to the extent of any accompanying credit, discount, refund or other allowance given to the customer; (b) Items returned to their source for credit or other allowance; (c) Amounts or credits received on claims for loss or damage to merchandise or other assets of your Amorino store but not for claims for loss of business under your business interruption insurance; (d) Sales of equipment, trade fixtures or similar property not constituting merchandise of your store; (e) Transfers of merchandise to or from other Amorino facilities when those transfers are made only for the convenient operation of the concerned facilities; (f) gift certificates or similar vouchers until they are redeemed at your store. You agree to pay the Advertising Fee on a monthly basis, within 10 days of the end of each month during the term of this Agreement, with the first Advertising Fee payment due ten days after the first month (full or partial) that your Store is open.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, franchisees can deduct sales of equipment, trade fixtures, or similar property (that is not merchandise) from their gross revenue. Gross revenue is used to calculate royalty fees, so this deduction directly lowers the royalty fees paid to Amorino.
This is a beneficial provision for Amorino franchisees because it prevents them from being charged royalty fees on sales of assets that are not part of the core gelato and related product sales. For example, if a franchisee sells a used gelato display case, the proceeds from that sale would not be subject to royalty fees.
It is important to note that this deduction only applies to the sale of equipment, trade fixtures, or similar property that is not considered merchandise. Sales of gelato, beverages, or other products normally sold in the store would still be included in gross revenue for royalty calculation purposes. Franchisees should maintain accurate records of all sales to properly calculate gross revenue and ensure accurate royalty payments to Amorino.