Does 'Regular Gross Sales' for a Best Brains franchise include registration fees for any program?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) "Regular Gross Sales" means all sales or revenues (other than Additional Program Sales and Add-On Gross Sales), derived directly or indirectly from the Franchised Business, including on and off premises (e.g., E-Learning).
Regular Gross Sales also includes registration fees for any program and business interruption insurance proceeds.
Regular Gross Sales does not include:
(i) sales taxes collected from customers and paid to the appropriate taxing authority, and
(ii) the amount of all coupons redeemed at the Franchised Business (but only if the coupons have been previously approved by the Company as provided in this Agreement and only if such coupons have been included in Regular Gross Sales)
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains's 2025 Franchise Disclosure Document, "Regular Gross Sales" does include registration fees for any program. This is significant because Best Brains franchisees must pay a royalty fee of 14% of Regular Gross Sales (subject to a minimum of $750 per month).
In practical terms, this means that a Best Brains franchisee's royalty payments will be calculated on total revenue, including all program registration fees. This could impact the franchisee's profitability, as royalty fees are a direct expense that reduces net income.
It is important to note that "Regular Gross Sales" does not include sales taxes collected from customers and paid to the appropriate taxing authority, or the amount of coupons redeemed at the Franchised Business (if the coupons have been previously approved by the Company and included in Regular Gross Sales).