What is a Bigfoot Forestry franchisee required to do with Gross Sales?
Bigfoot_Forestry Franchise · 2025 FDDAnswer from 2025 FDD Document
You must deposit all Gross Sales into the bank account and ensure sufficient funds are available for withdrawal before each due date.
You are responsible for all taxes imposed on you or us based on products, intangible property (including trademarks) or services we provide to you.
- 2.
Definitions: As used in this Disclosure Document, the following capitalized terms have the meanings given to them below:
"Brand Fund" means the brand and system development fund that we currently administer to promote public recognition of our brand and improve our System.
"Gross Sales" means all gross sums you bill or collect from all goods and services you sell, plus all other sums you collect from the operation of your Business, including any advertising revenues, sponsorship fees and business interruption insurance proceeds.
Gross Sales excludes: (a) sales or use taxes; (b) customer refunds; and (c) revenues from the sale of equipment in the ordinary course of business.
Source: Item 6 — OTHER FEES (FDD pages 12–15)
What This Means (2025 FDD)
According to Bigfoot Forestry's 2025 Franchise Disclosure Document, franchisees are required to deposit all Gross Sales into a designated bank account and ensure sufficient funds are available for withdrawal before each due date. This requirement ensures that Bigfoot Forestry can electronically debit the franchisee's account for fees and other amounts owed. Gross Sales are defined as all gross sums billed or collected from goods and services, including advertising revenues, sponsorship fees, and business interruption insurance proceeds. However, Gross Sales exclude sales or use taxes, customer refunds, and revenues from the sale of equipment in the ordinary course of business.
This process is fairly standard in franchising, as it provides the franchisor with a reliable method for collecting royalties and other fees. By mandating that all Gross Sales pass through a specific account, Bigfoot Forestry maintains better visibility and control over revenue streams. The ACH Authorization Form, attached to the Franchise Agreement, formalizes this arrangement, allowing Bigfoot Forestry to directly debit the franchisee's account.
Franchisees should be aware of the importance of maintaining sufficient funds in the designated account to avoid any penalties or disruptions. The definition of Gross Sales is also crucial, as it clarifies what revenues are subject to royalty and other percentage-based fees. Understanding these requirements is essential for managing cash flow and ensuring compliance with the Franchise Agreement.
Bigfoot Forestry also uses Gross Sales to calculate other fees, including the royalty fee (ranging from 4.5% to 7.0% depending on Gross Sales bracket), the Brand Fund fee (up to 3%, currently 1%), the Local Marketing Commitment (greater of 2% or $1,000 per month), and the Cooperative Advertising Fee (up to 2%).