How does Better Blend define 'Adjusted Gross Sales' in the franchise agreement?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
- "Adjusted Gross Sales" is defined in our franchise agreement as the total dollar amount of all sales generated through your business for a given period, including, but not limited to, payment for any services or products sold by you, whether for cash or credit. It also includes any proceeds you receive from business interruption insurance. Adjusted Gross Sales does not include (i) coupons, discounts, and bona fide refunds to customers, (ii) sales taxes collected, or (iii) sales of prepaid cards or similar products (but the redemption of any such card or product will be included in Adjusted Gross Sales).
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- You must report your adjusted gross sales to us each week. If you fail to report your adjusted gross sales, we will withdraw estimated royalty fees and marketing fund contributions
based on 125% of the most recent adjusted gross sales you reported. We will true-up the actual fees after you report adjusted gross sales.
Source: Item 6 — OTHER FEES (FDD pages 11–15)
What This Means (2024 FDD)
According to Better Blend's 2024 Franchise Disclosure Document, 'Adjusted Gross Sales' is a critical figure, as it is used to calculate royalty fees and marketing fund contributions. Better Blend defines 'Adjusted Gross Sales' as the total dollar amount of all sales generated by the business, including payments for services or products sold, whether for cash or credit. It also encompasses any proceeds received from business interruption insurance.
However, the definition also specifies certain exclusions. Adjusted Gross Sales does not include revenue from coupons, discounts, and bona fide refunds to customers. It also excludes sales taxes collected and sales of prepaid cards or similar products. However, the redemption of any such prepaid cards or products will be included in Adjusted Gross Sales.
Better Blend franchisees must report their adjusted gross sales to Better Blend each week. Failure to do so will result in Better Blend estimating royalty fees and marketing fund contributions based on 125% of the most recently reported adjusted gross sales. Once the franchisee reports the actual adjusted gross sales, Better Blend will then adjust the fees accordingly. This weekly reporting requirement and the potential for estimated fees underscore the importance of accurate and timely sales reporting for Better Blend franchisees.