Are food truck sales included in the 'Gross Sales' calculation for a Carbones Pizzeria franchise?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
ion may be venued in any court having jurisdiction over all the parties and a significant nexus to the parties; and (2) to the extent that either party believes it is necessary to seek injunctive relief against the other, the party seeking relief may initiate that action in the county in which the other party has its principal office (which in the case of an action against Franchisee, shall be the county in which Franchisee is domiciled, or the county in which the Restaurant is located).
26. Definitions.
The following definitions shall apply to this Agreement:
- a. Competing Business. The term "Competing Business" means an eat-in, or take-out, or combination eat-in/take out restaurant of any other facility that serves pizza.
- b. Confidential Information. The term "Confidential Information" means all business plans and methods developed by Franchisor and its affiliates to be used in connection with the operation of a restaurant or other facility operated under the Names and Marks, including the Secret Recipes, any other recipes, standards, specifications, methods, procedures, techniques, sourcing, technology, and management systems, all of which may be changed, improved, and further developed from time to time by Franchisor, and all information contained in Franchisor's Operations Manual as it may be amended from time to time by Franchisor (the "Manual").
- c. Gross Sales.
Source: Item 23 — RECEIPTS (FDD pages 30–116)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, the definition of 'Gross Sales' includes revenues from food truck sales. Specifically, Gross Sales means the total revenue from all business activities taking place at the Restaurant, including amounts received for food and beverages sold from a food truck or other vehicle.
This is important for prospective franchisees because the Royalty and Advertising fees are calculated as a percentage of Gross Sales. The franchisee will pay a Royalty based on a tiered percentage of Gross Sales: (a) 4% of total Gross Sales on the initial $1,000,000 in Gross Sales per calendar year, at which point the Royalty is reduced to (b) 3% of Gross Sales on the next $1,000,000 per calendar year, at which point the Royalty is reduced to (c) 2% of Gross Sales over $2,000,000 in such calendar year. Additionally, the franchisee will pay an Advertising Fee of one percent (1%) of monthly Gross Sales, although this fee is not due on Gross Sales exceeding $2,000,000 in any calendar year.
However, the FDD also specifies certain exclusions from Gross Sales. Amounts collected and remitted to governmental taxing authorities for sales or occupation taxes, non-food vending machine sales discounts, and amounts received from alcohol sales at a fully licensed liquor establishment are excluded from the Gross Sales calculation. Therefore, while food truck sales are included, franchisees should be aware of these specific exclusions when calculating their Gross Sales for royalty and advertising fee payments.