Can Buns On Fire authorize the exclusion of certain items from Gross Revenue?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
- (ii.) Franchisor may, from time to time, authorize certain other items to be excluded from Gross Revenue. Any such permission may be revoked or withdrawn at any time in writing by Franchisor in its discretion. In addition to the foregoing, the following are included within the definition of "Gross Revenue" described except as noted below:
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- The full value of Products furnished to Franchisee's employees as an incident to their employment except that the value of any discounts extended to such employees may be credited against Gross Revenue during the reporting month in which the Products were furnished for the purpose of determining the amount of Gross Revenue upon which the Royalty Fee is due; and
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- All proceeds from the sale of coupons, gift certificates or vouchers; provided that at the time such coupons, gifts certificates or vouchers are redeemed the retail price thereof may be credited against Gross Revenue during the reporting month in which such coupon, gift certificate or voucher is redeemed for the purpose of determining the amount of Gross Revenue upon which the Royalty Fee is due.
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Source: Item 23 — RECEIPTS (FDD pages 49–200)
What This Means (2025 FDD)
According to the 2025 Buns On Fire Franchise Disclosure Document, Buns On Fire may authorize the exclusion of certain items from a franchisee's Gross Revenue. Any such permission can be revoked or withdrawn at any time in writing at Buns On Fire's discretion.
The FDD specifies that the full value of products furnished to employees as an incident of their employment is included in Gross Revenue. However, the value of any discounts extended to employees may be credited against Gross Revenue during the reporting month in which the products were furnished. Also, all proceeds from the sale of coupons, gift certificates, or vouchers are included in Gross Revenue. However, when these coupons, gift certificates, or vouchers are redeemed, the retail price can be credited against Gross Revenue during the reporting month in which they are redeemed.
This means that while franchisees must initially include the value of employee meals and the sale of gift certificates in their gross revenue calculations, they can later deduct the discounted portion of employee meals and the value of redeemed gift certificates. This impacts the royalty fee calculation, as the royalty is based on Gross Revenue. Franchisees should maintain accurate records of employee discounts and gift certificate redemptions to ensure accurate royalty payments and to be prepared for potential audits.