Besides sales taxes, what is excluded from the definition of 'Gross Sales' for a Ben Jerrys franchise?

According to Ben Jerrys's 2025 Franchise Disclosure Document, 'Gross Sales' for the purpose of calculating royalties and advertising fees includes revenue from all product sales and all other income, whether in cash or credit, related to the Shop, Off-Premises Activities, On-Demand Sales, and Mobile Vending. However, the definition of 'Gross Sales' specifically excludes sales taxes. This means that franchisees will not pay royalties or advertising fees on the portion of revenue collected to cover sales tax obligations.

For a prospective Ben Jerrys franchisee, this definition is important because it directly impacts the amount of royalties and advertising fees owed to the franchisor. By excluding sales taxes from the calculation, the franchisee only pays these fees on the actual revenue generated from sales, not on the taxes collected on behalf of the government. This exclusion reduces the overall cost of operating the franchise and can improve profitability.

It is common practice in the franchise industry to exclude sales taxes from the definition of gross sales for the purpose of calculating royalties and advertising fees. This ensures that franchisees are not penalized for collecting taxes on behalf of the government and that these fees are based solely on the revenue generated from the sale of goods and services. Franchisees should carefully review the definition of 'Gross Sales' in the Franchise Agreement to fully understand how royalties and advertising fees are calculated.