What is the definition of 'Gross Sales (Byrider Vehicle Sales)' for the Ultra2 Royalty Fee calculation?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
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The term "Gross Sales (Byrider Vehicle Sales)" means the full purchase price of all vehicles sold at retail (whether financed or sold for cash), including charges for vehicle service contracts, documentary fees, and all other fees or charges which accompany the sale, minus overallowances given on trade-in vehicles. For example, the customer's purchase price of the vehicle is $10,000 and the customer has a trade in with an actual cash value of $1,000 and assuming no vehicle service contract or other charges. However, the Franchisee offers $1,500 for the trade in. The "overallowance" is the amount offered of $1,500 less the actual cash value of $1,000 equaling $500. Therefore, "Gross Sales (Byrider Vehicle Sales)" in this example is the full purchase price of $10,000 less the overallowance of $500 which equals $9,500. Not included in "Gross Sales (Byrider Vehicle Sales)" are receipts from "wholesaled vehicles." Wholesaled Vehicles are defined as vehicles sold for resale and for which
Source: Item 6 — Other Fees (FDD pages 21–32)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, "Gross Sales (Byrider Vehicle Sales)" is defined as the full retail purchase price of all vehicles sold, whether financed or sold for cash. This includes charges for vehicle service contracts, documentary fees, and all other fees or charges that accompany the sale. However, the gross sales figure is reduced by any overallowances given on trade-in vehicles.
To illustrate, if a customer purchases a vehicle for $10,000 and trades in a vehicle with an actual cash value of $1,000, but Byrider offers $1,500 for the trade-in, the "overallowance" is $500 (the difference between the offered amount and the actual cash value). In this case, the "Gross Sales (Byrider Vehicle Sales)" would be $9,500 (the full purchase price of $10,000 less the overallowance of $500).
Importantly, the definition explicitly excludes receipts from "wholesaled vehicles," which are defined as vehicles sold for resale and not subject to sales tax. This distinction is crucial for Byrider franchisees to accurately calculate their gross sales for royalty fee purposes, ensuring they are only paying royalties on retail sales to consumers and not on vehicles sold to other dealers for resale.