What is the definition of 'Gross Revenue' for an Amorino franchise?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
In each calendar year during the term of this Agreement, we can require you to spend up to the percentage of your Gross Revenue specified in the Data Sheet, for advertising, marketing and public relations initiatives, as further described in Section 12.C. "Gross Revenue" means all cash collected, or other consideration received, for the sale of all products and services of any nature rendered or sold at or from or as a result of the Store and/or otherwise related to the Franchised Business, whether such products are sold or services are
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.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, Gross Revenue is defined as all cash collected or other consideration received for the sale of all products and services of any nature rendered or sold at or from the store, or as a result of the franchised business. This includes all income related to the franchised business.
However, certain items are excluded from the Gross Revenue calculation for the purpose of computing the royalty fee. These exclusions include revenue collected from customers in the form of sales tax, federal, state, county, or city taxes, excise tax, or other similar taxes that the franchisee owes to governmental entities. Additionally, deductions can be made for the selling price of goods returned by customers, items returned to their source for credit, amounts received on claims for loss or damage to merchandise (but not for business interruption insurance claims), sales of equipment not considered merchandise, transfers of merchandise to other Amorino facilities, and gift certificates until they are redeemed.
This definition is important because many fees payable to Amorino, such as the advertising fee and decorations fee, are calculated as a percentage of Gross Revenue. Franchisees must accurately report their Gross Revenue to Amorino and maintain detailed records to support these figures, as Amorino has the right to audit these records. Understanding what constitutes Gross Revenue and what can be excluded is crucial for accurate financial reporting and fee calculation for Amorino franchisees.