For Bonchon, what costs are deducted from Gross Revenues when calculating the royalty?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
Gross Revenues were calculated in the same manner that you would calculate Gross Revenues for purposes of determining your Royalty. For the avoidance of doubt, "Gross Revenues" means all revenues and income from any source that was derived or received from, through, by or on account of the operation of the Restaurant business, whether received in cash, in services, in kind, from barter and/or exchange (valued at the full retail value of the goods or services received), on credit (whether or not ultimately payment on credit transactions is ultimately received), or otherwise. The following costs have been deducted from Gross Revenues: documented refunds, chargebacks, credits and allowances that given in good faith to customers; and, all sales taxes or similar taxes which legally charged to customers (if such taxes were added the taxes charged to the customers). This figure does not reflect either gross or net profit.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 81–84)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, Gross Revenues are used to calculate royalty fees. Gross Revenues include all income from any source derived from the Restaurant business, whether received in cash, services, or credit.
When calculating Gross Revenues for royalty purposes, Bonchon deducts specific costs. These deductions include documented refunds, chargebacks, credits, and allowances given in good faith to customers. Additionally, all sales taxes or similar taxes legally charged to customers are deducted, provided these taxes were added to the prices charged to the customers.
It is important to note that the Gross Revenues figure does not reflect either gross or net profit. Prospective franchisees should conduct their own independent investigation of the costs and expenses they will incur while operating a Bonchon Restaurant. Franchisees and former franchisees listed in the Disclosure Document may be a source of this information.