Does 'Regular Gross Sales' for a Best Brains franchise include revenue from E-Learning?
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' 2025 Franchise Disclosure Document, Regular Gross Sales does include revenue derived from E-Learning. The document specifies that Regular Gross Sales encompasses all sales or revenues, whether direct or indirect, originating from the franchised Best Brains business. This definition explicitly includes revenue from both on-premises and off-premises activities, with E-Learning provided as an example of such off-premises revenue.
This is significant for prospective Best Brains franchisees because the royalty fees they pay to Best Brains are calculated as a percentage of Regular Gross Sales. The royalty fee is 14% of Regular Gross Sales, subject to a $750 monthly minimum. By including E-Learning revenue in Regular Gross Sales, Best Brains ensures that franchisees pay royalties on all revenue streams associated with the Best Brains system, regardless of where the services are delivered.
It is important to note that the definition of Regular Gross Sales also includes registration fees for any program and business interruption insurance proceeds. However, it excludes sales taxes collected from customers and remitted to the appropriate taxing authority, as well as the amount of approved coupons redeemed at the franchised business. Franchisees should carefully track their revenue sources and deductions to accurately calculate their royalty payments to Best Brains.