What is the definition of 'Gross Receipts' for the purpose of calculating the Advertising association fee for Annex Brands?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
Note 2: "Gross Receipts" means the total of all sales of products and services to your customers, whether or not sold or performed at or from the franchised business, excluding: (i) sales, use or service taxes
collected and paid to appropriate taxing authorities; (ii) customer refunds and adjustments; (iii) the cost of electronic funds transfers for resale; (iv) the cost of money orders for resale; (v) utility funds collected; (vi) the cost of lottery tickets for resale and phone cards for resale; (vii) the cost of 3rd party truck rental sales; (viii) the cost of eBay sales; (ix) the cost of metered postage and postage stamps for resale; and (x) the cost of ancillary fees paid to the appropriate government agencies to process fingerprinting, LiveScan and passports. We reserve the right periodically, in our sole discretion, to add additional exclusions to the list above as new programs, products or services are established, or as changes to existing programs, products or services are established, as specified by us in our Manuals, in writing or otherwise.
Source: Item 6 — OTHER FEES (FDD pages 24–32)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, "Gross Receipts" is defined as the total revenue from all sales of products and services to customers, whether sold at or from the franchised business. This figure is used to calculate various fees, including the advertising association fee, which is the greater of $150 or 1% of Gross Receipts, paid monthly. Understanding this definition is crucial for franchisees to accurately calculate and report their sales figures, ensuring correct fee payments.
However, the definition of Gross Receipts for Annex Brands excludes certain items. These exclusions include sales, use, or service taxes collected and paid to taxing authorities, customer refunds and adjustments, the cost of electronic funds transfers for resale, the cost of money orders for resale, utility funds collected, the cost of lottery tickets for resale and phone cards for resale, the cost of 3rd party truck rental sales, the cost of eBay sales, the cost of metered postage and postage stamps for resale, and the cost of ancillary fees paid to the appropriate government agencies to process fingerprinting, LiveScan and passports. These exclusions reduce the base amount on which fees are calculated, potentially lowering the overall cost for the franchisee.
Annex Brands retains the right to modify these exclusions periodically at their discretion as new programs, products, or services are introduced or as changes are made to existing ones. These changes will be communicated in the manuals or in writing. Franchisees should stay informed about any updates to the definition of "Gross Receipts" to ensure accurate reporting and avoid discrepancies in fee payments. This flexibility allows Annex Brands to adapt the definition to evolving business conditions and offerings.