For a Buildingstars franchise, what is included in the calculation of 'Gross Sales'?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
- D. "Gross Sales" means the total money or property earned by FRANCHISEE or derived from or in connection with the operation of the Business, including all fees and other charges for every type of service performed and goods and services sold. Gross Sales will be calculated at the time the services or products from which they were derived are delivered or rendered. The term does not include applicable sales, use or service taxes and any refunds and allowances actually given to Customers.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, "Gross Sales" is defined as the total money or property earned by the franchisee. This includes all fees and other charges for every type of service performed, as well as goods and services sold in connection with the operation of the Business. Gross Sales are calculated at the time the services or products are delivered or rendered.
However, the definition of Gross Sales for a Buildingstars franchise specifically excludes applicable sales, use, or service taxes. It also excludes any refunds and allowances actually given to customers. This means that a franchisee will not pay royalties or other percentage-based fees on these amounts.
Understanding what constitutes Gross Sales is crucial for a Buildingstars franchisee because several fees, such as the Royalty Fee, Administration Fee, and Insurance Program Fee, are calculated as a percentage of Gross Sales. Accurate reporting of Gross Sales is essential, as Buildingstars retains the right to audit the franchisee's records and can impose penalties for underreporting.