What are the two main revenue streams for Bhc?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
in individual cases in our discretion.
- (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.
- (3) Subfranchisees must pay us a Royalty Fee of 4.5% from Gross Revenues derived from the Subfranchised BHC Restaurants. The royalty you charge to Subfranchisees shall not exceed seven percent (7%) of Gross Revenues of Subfranchised BHC Restaurants.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the primary revenue streams are derived from the operation of franchised restaurants and the retail distribution of food products. Specifically, the document defines "Gross Revenue" as encompassing all income earned from the operation of the franchised Bhc restaurant, irrespective of the payment method (cash, credit, gift card redemption), and includes revenue from both on-premises and off-premises sales, such as delivery services like Door Dash and Uber Eats. Gross Revenue also includes any proceeds from business insurance.
This broad definition of Gross Revenue is crucial for franchisees as it forms the basis for calculating royalty fees and marketing contributions, once implemented. However, Gross Revenue excludes taxes collected from customers and remitted to governmental authorities, bona fide customer refunds, and tips or gratuities paid to employees. This distinction is important for accurate financial reporting and fee calculation.
Additionally, Bhc USA, the parent company, also generates revenue through the retail distribution of food products via its subsidiaries, BHC Farmers Market USA Inc and BHC Chapman USA Inc. While the FDD focuses primarily on the franchise operations, it acknowledges this secondary revenue stream as part of the overall business model. Prospective franchisees should focus on maximizing Gross Revenue from their restaurant operations while adhering to the guidelines for exclusions to ensure accurate financial reporting and compliance with the franchise agreement.