For Bevaris Alliance, what is the definition of 'Gross Sales Receipts' in terms of the source of revenue?
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 similar operations.
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. This includes revenues from cash, checks, credit cards, pre-paid cards, pre-order and paid meals through designated software, or credit terms. These revenues are derived from all sales of food, beverages, and other items and services offered and sold as part of the Bevaris Alliance Branded Business.
However, certain amounts are deducted from or not included in Gross Sales Receipts. These include refunds to customers, amounts received in connection with settlements for damaged or unsalable food and beverages, amounts deemed uncollectible (bad debts or costs of collection), 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, as is customary for similar operations.
For a prospective Bevaris Alliance franchisee, understanding this definition is crucial because royalty payments are typically based on a percentage of Gross Sales Receipts. Knowing what constitutes includable and excludable revenue helps in accurately calculating royalty obligations and assessing the financial performance of the franchise. Franchisees should pay close attention to the specific deductions allowed to ensure compliance and avoid overpayment of royalties.