What items are excluded from the definition of 'Gross Revenue' for a Bhc restaurant?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
(2) "Gross Revenue" means the gross amount of revenue, whether for cash, by redemption of gift cards or certificates or for credit, regardless of collection, earned or received by you from any source in connection with the operation of the BHC Restaurant or with any similar or related activity, whether on or off your business premises, arising directly or indirectly from whatever source, including but not limited to sales from delivery or deliver services such as Door Dash, Uber Eats, Postmates, etc. Gross Revenue also includes any amount received from business insurance proceeds. "Gross Revenue" does not include: (i) the amount of any tax imposed by any governmental authority directly on sales and collected from customers, provided that the amount of any such tax is shown separately and is in fact paid by you to the appropriate governmental authority; (ii) the amount of any bona fide customer refunds; and (iii) tips or gratuities paid or payable to your employees.
Source: Item 6 — Other Fees (FDD pages 12–18)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, "Gross Revenue" is comprehensively defined, but certain items are specifically excluded from its calculation. This is important because several fees, including the Marketing and Promotion Fees and Royalty Fees, are calculated as a percentage of Gross Revenue.
Specifically, the following items are not included in Bhc's Gross Revenue calculation: (i) the amount of any tax imposed by any governmental authority directly on sales and collected from customers, provided that the amount of any such tax is shown separately and is in fact paid by you to the appropriate governmental authority; (ii) the amount of any bona fide customer refunds; and (iii) tips or gratuities paid or payable to your employees.
For a prospective Bhc franchisee, understanding this definition is crucial for accurate financial reporting and fee calculation. Ensuring that excluded items are properly accounted for can directly impact the franchisee's profitability and compliance with the franchise agreement. It is also important to note that Gross Revenue includes sales from delivery services like Door Dash, Uber Eats, and Postmates, as well as any amount received from business insurance proceeds.