For Anago franchisees, what constitutes "Gross Revenues" for the purpose of calculating the Royalty Fee?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
Unit Franchises, employees or other contractors, excepting only the amount of any sales taxes that are collected and paid to the taxing authority. Gross Revenues includes the proceeds of any business interruption insurance. Cash refund and credit given to Clients (except credit for missed cleaning days) and receivables uncollectable from Clients will be deducted in computing Gross Revenues to the extent that the cash, credit or receivables represent amounts previously included in Gross Revenues where Royalty Fees and other amounts were paid. Gross Revenues are deemed received by You at the time the goods, products, merchandise or services from which they derive are delivered or rendered or at the time the relevant sale takes place, whichever occurs first. Gross Revenues consisting of property or services (for example, "bartering" or "trade outs") are valued at the prices applicable, at the time the Gross Revenues are received, and to the products or services exchanged for the Gross Revenues.
Source: Item 6 — OTHER FEES (FDD pages 12–19)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, Gross Revenues for the purpose of calculating royalty fees include revenues from Unit Franchises, employees, or other contractors. The only exclusion from Gross Revenues is the amount of sales taxes that are collected and paid to the taxing authority. Gross Revenues also include proceeds from any business interruption insurance.
For Anago franchisees, cash refunds and credits given to clients (except credit for missed cleaning days) and receivables uncollectable from Clients will be deducted in computing Gross Revenues to the extent that the cash, credit or receivables represent amounts previously included in Gross Revenues where Royalty Fees and other amounts were paid. Gross Revenues are deemed received by the franchisee at the time the goods, products, merchandise or services from which they derive are delivered or rendered or at the time the relevant sale takes place, whichever occurs first.
Gross Revenues consisting of property or services (for example, "bartering" or "trade outs") are valued at the prices applicable, at the time the Gross Revenues are received, and to the products or services exchanged for the Gross Revenues. This definition is important for Anago franchisees as it directly impacts the amount of royalty fees owed to Anago. Franchisees should ensure they accurately track and report all revenue streams, including non-cash transactions, to avoid discrepancies and potential disputes with Anago.