Are gift card redemptions included in Baya Bar's Gross Revenue?

According to Baya Bar's 2024 Franchise Disclosure Document, gross revenue does not include gift card purchases at the time of purchase. However, the gross revenue does include the redemption amount of purchases made using gift cards.

This means that Baya Bar franchisees will not pay royalties or brand fund contributions on the initial sale of a gift card. Instead, these fees are collected when the gift card is used to make a purchase at the Baya Bar location. This policy ensures that Baya Bar collects fees based on actual sales of goods and services rather than on the initial issuance of store credit.

For a prospective Baya Bar franchisee, this distinction is important for financial planning and reporting. Franchisees must accurately track both gift card sales and redemptions to properly calculate and report their gross revenue. This also affects the timing of royalty and brand fund contribution payments, as these are tied to when the gift cards are redeemed, not when they are sold.