What is included in the calculation of 'Gross Sales' for a Bombs Away franchise?

According to Bombs Away's 2024 Franchise Disclosure Document, 'Gross Sales' is defined as the total dollar amount of all sales generated through the Business for a given period. This includes payments for any services or products sold by the franchisee, whether the payment is in cash or credit. This figure is used to calculate royalty fees and marketing fund contributions.

However, the calculation of Gross Sales for a Bombs Away franchise specifically excludes certain items. These exclusions are (i) bona fide refunds to customers, (ii) sales taxes collected by the franchisee, (iii) sales of used equipment not in the ordinary course of business, and (iv) sales of prepaid cards or similar products. It is important to note that while the sale of prepaid cards is excluded, the redemption of these cards is included in Gross Sales.

For a prospective Bombs Away franchisee, understanding this definition is crucial because it directly impacts the amount of royalty fees and marketing fund contributions owed to the franchisor. Accurate tracking and reporting of sales, along with proper exclusion of the specified items, will ensure compliance with the franchise agreement and avoid potential disputes or penalties. Franchisees should maintain detailed records of all transactions and consult with the franchisor or a financial professional if they have any questions about what should or should not be included in Gross Sales.