What is included in the calculation of 'Gross Sales' for a Black Bear Diner franchise?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
- "Gross Sales" means the total amount of all revenues Franchisee receives from the sale of all menu items, Gift Shop Products, banquet and catering services and from goods and services from all sources in any way connected with the Franchised Restaurant whether for check, cash, credit or otherwise including, without limitation, all proceeds from any business interruption insurance.
Gross Sales does not include sales tax collected from customers and paid to the appropriate taxing authorities, discounts deducted from the prices charged and the price of employees' meals actually reported and paid;
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
According to the 2025 Black Bear Diner Franchise Disclosure Document, 'Gross Sales' encompasses the total revenue a franchisee receives from various sources connected to the restaurant. This includes all sales of menu items, gift shop products, banquet and catering services, and any other goods and services, regardless of the payment method (check, cash, credit, etc.). The calculation also incorporates proceeds from business interruption insurance.
However, the 'Gross Sales' calculation excludes certain items. Specifically, it does not include sales tax collected from customers that is then paid to the appropriate taxing authorities. Additionally, discounts deducted from the prices charged to customers are not included in the gross sales figure. The cost of employee meals that are reported and paid for are also excluded from the gross sales calculation.
Understanding what constitutes 'Gross Sales' is crucial for a Black Bear Diner franchisee because several financial obligations are tied to this figure. For instance, franchisees are required to spend a percentage of their gross sales on local advertising and contribute a percentage to the Marketing Fund. Accurate calculation and reporting of gross sales are therefore essential for compliance and financial planning.