How might a Baya Bar franchisee be required to submit the Gross Revenue Report?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee shall, on the Tuesday following the close of each calendar week (Monday through Sunday), furnish Franchisor with a report showing Franchisee's Gross Revenue at or from the Franchised Business and/or made pursuant to the rights granted hereunder during such period (the "Gross Revenue Report").
The Gross Revenue Report shall be in such form and
shall contain such information as Franchisor may from time to time prescribe. Franchisor reserves the right to establish a point of sale system ("POS System") that Franchisor may require Franchisee to use in the operation of the Franchised Business. At Franchisor's option, Franchisee shall submit the Gross Revenue Report by an electronic transfer of data via the POS System at the times and interims then specified by Franchisor.
- 6.1.4 Method of Payment.
Franchisee shall, together with the submission of the Gross Revenue Report, pay Franchisor the Royalty Fee and the Brand Fund Contribution, as defined and more particularly described in Article 13, then due.
At Franchisor's request, Franchisee must execute documents, including but not limited to, the Authorization attached as Attachment 5, that allow Franchisor to automatically take the Royalty Fee and Brand Fund Contribution due as well as other sums due Franchisor, from business bank accounts via electronic funds transfers or Automated Clearing House ("ACH") payments.
Franchisee's failure to allow electronic funds transfers or ACH payments on an ongoing basis is a material breach of this Agreement.
If Franchisee fails to timely report Gross Revenue, then, in addition to a late fee and interest pursuant to Sections 6.2 and 6.3 hereof, Franchisor shall collect one hundred twenty percent (120%) of the last Royalty Fee payable.
Franchisor shall reconcile amounts when Gross Revenues are reported.
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, a franchisee is required to furnish the franchisor with a Gross Revenue Report each week, specifically on the Tuesday following the close of each calendar week (Monday through Sunday). This report details the franchisee's gross revenue generated at or from the franchised business. The report must be in a format and contain information as prescribed by Baya Bar.
Baya Bar retains the right to implement a point-of-sale (POS) system that franchisees may be required to use. If Baya Bar exercises this option, the franchisee will then be required to submit the Gross Revenue Report through an electronic data transfer via the POS system, adhering to the timelines specified by Baya Bar.
The Gross Revenue Report is crucial because it determines the royalty fees and brand fund contributions that the franchisee owes to Baya Bar. These payments are due at the same time the Gross Revenue Report is submitted. Failure to report gross revenues in a timely manner can result in a penalty of 120% of the last royalty fee payable, in addition to late fees and interest. Baya Bar will reconcile amounts once gross revenues are reported.