What is excluded from 'Gross Revenues' when calculating the Beehive Homes Franchise Royalty?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
For purposes of determining the Franchise Royalty, "Gross Revenues" is defined to be the gross receipts of every kind and nature whatsoever received by Franchisee directly or indirectly in connection with the operation of the franchised business, the Home and/or providing of services, excepting only the amount of sales or use taxes levied upon the sale of goods or services by a governmental taxing authority and actually paid to said taxing authority.
Source: Item 23 — RECEIPTS (FDD pages 34–123)
What This Means (2025 FDD)
According to Beehive Homes' 2025 Franchise Disclosure Document, the franchise royalty is 5% of Gross Revenues. Gross Revenues are defined as all gross receipts of any kind received by the franchisee, directly or indirectly, from operating the Beehive Homes franchise. However, there is one specific exclusion from the calculation of Gross Revenues.
Specifically, the only item excluded from Gross Revenues when calculating the 5% franchise royalty is the amount of sales or use taxes. These taxes must be levied upon the sale of goods or services by a governmental taxing authority. Furthermore, these taxes must be actually paid to the taxing authority to qualify for the exclusion.
For a prospective Beehive Homes franchisee, this means that while nearly all income is subject to the 5% royalty, they do not have to pay a royalty on sales or use taxes that they collect and remit to the government. This is a fairly standard practice in franchising, as the royalty is intended to be a percentage of the franchisee's revenue, not pass-through taxes.