For Bevaris Alliance, what is the condition for excluding amounts from 'Gross Sales Receipts'?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
Gross Sales Receipts: The total gross sales revenues accrued or collected from the operations of Franchisee's Branded Business, whether for cash, check, credit card, pre-paid cards, pre order and paid meals through designated software or on credit terms, from all sales of food, beverages, and other items and services (Food and Beverages) offered and sold pursuant to the Franchisee's Branded Business. The following shall be deducted from (or, as appropriate within its context, not included in) Gross Sales Receipts: (a) Any amounts, whether in cash, credit, or otherwise refunded customers; (b) All amounts received in connection with the settlement of claims for damaged or unsalable Food and Beverages; (c) All amounts which are deemed to represent uncollectible accounts, bad debts or costs of collection; (d) The cost of meals provided to the employees of Franchisee at cost, if any; and (e) the cost of charitable, promotional, and other complimentary meals given in the ordinary course of business and as is customary for simi
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to Bevaris Alliance's 2024 Franchise Disclosure Document, Gross Sales Receipts are defined as the total gross sales revenues accrued or collected from the operations of the Franchisee's Branded Business, whether for cash, check, credit card, pre-paid cards, pre order and paid meals through designated software or on credit terms, from all sales of food, beverages, and other items and services offered and sold pursuant to the Franchisee's Branded Business.
Specifically, the following amounts shall be deducted from (or not included in) Gross Sales Receipts: any amounts refunded to customers, amounts received from settling claims for damaged or unsalable food and beverages, amounts deemed uncollectible (bad debts or collection costs), the cost of meals provided to employees at cost, and the cost of charitable, promotional, and other complimentary meals given in the ordinary course of business and customary for similar businesses.
For a prospective Bevaris Alliance franchisee, this definition is important because the royalty fee is based on a percentage of gross sales receipts. Understanding what can be excluded from gross sales receipts can directly impact the amount of royalty fees owed to Bevaris Alliance. It is important to maintain accurate records of all deductions and ensure they meet the criteria outlined in the franchise agreement.