For Bonchon franchises, what revenues are included in the definition of 'Gross Revenues'?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
5.05 Definition of Gross Revenues
"Gross Revenues" means all revenues and income from any source that you directly or indirectly derive or receive from, through, by or on account of the operation of the franchised Business and/or Restaurant (including, without limitation, income related to take-outs, catering operations, digital and online sales including through third-party online ordering and/or delivery aggregators, special events and revenues and income from permitted non-restaurant operations conducted under or using the Marks), 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 you ultimately receive payment on credit transactions), or otherwise. Gross Revenues specifically includes revenues and income you receive from the proceeds of any business interruption insurance policies and/or the sale of any promotional or premium items. You may deduct from Gross Revenues, to the extent that they have been included in your calculation of Gross Revenues, documented refunds, chargebacks, credits and allowances that you give in good faith to customers; proceeds from property damage or liability insurance; and proceeds from any civil forfeiture, condemnation, or seizure by government entities. You may also deduct from Gross Revenues all sales taxes or similar taxes which you legally charge to customers if you add the taxes when you charge the customers; send the tax payments to the appropriate tax authorities when due; furnish to us within 30 days of payment an official receipt for payment of the taxes or any other evidence that we reasonably consider acceptable; and, state in the weekly report required by Section 5.06 the amount of all these taxes and the payments to which they relate.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, "Gross Revenues" encompasses all income a franchisee directly or indirectly receives from operating the franchised Bonchon business. This broad definition includes revenues from various sources such as take-out orders, catering services, digital and online sales (including those through third-party platforms), and special events. It also covers income from any permitted non-restaurant operations conducted using Bonchon's trademarks.
Gross Revenues include income received in any form, whether in cash, services, or in-kind, with barter and exchange valued at full retail price. It also includes revenues from credit transactions, regardless of whether payment is ultimately received. Furthermore, Gross Revenues specifically include proceeds from business interruption insurance policies and the sale of promotional or premium items.
However, franchisees can deduct certain items from Gross Revenues, provided they were initially included in the calculation. These deductions include documented refunds, chargebacks, credits, and allowances given to customers in good faith. Proceeds from property damage or liability insurance, as well as proceeds from civil forfeiture, condemnation, or seizure by government entities, are also deductible. Additionally, franchisees can deduct sales taxes or similar taxes legally charged to customers, provided they remit these taxes to the appropriate authorities and provide proof of payment to Bonchon.