What is excluded from the definition of 'Gross Revenues' for a Cd One Price Cleaners franchise?
Cd_One_Price_Cleaners Franchise · 2025 FDDAnswer from 2025 FDD Document
Note 2: "Gross Revenues" means revenue from the sale of all products and services and all other income or consideration of every kind and nature that you or the Store receives, including all revenues associated with delivering and/or selling products or services off-premises to customers and any proceeds from business interruption insurance, whether for cash, credit, charge account, debit account, exchange, barter or otherwise, and regardless of collection, less (a) any
sales taxes and other taxes you collect from your customers and pay directly to the appropriate taxing authority, and (b) any customer discounts or refunds.
Source: Item 6 — Other Fees (FDD pages 13–20)
What This Means (2025 FDD)
According to Cd One Price Cleaners' 2025 Franchise Disclosure Document, "Gross Revenues" are comprehensively defined as all income the store receives from product and service sales, including on and off-premises transactions and business interruption insurance proceeds. However, there are specific exclusions to this definition that directly impact the calculation of royalties and other fees.
Specifically, Cd One Price Cleaners excludes two items from the calculation of Gross Revenues: (a) any sales taxes and other taxes you collect from your customers and pay directly to the appropriate taxing authority, and (b) any customer discounts or refunds. This means that franchisees do not pay royalties or marketing fees on the portion of revenue collected for sales taxes remitted to the government or on money refunded to customers.
For a prospective Cd One Price Cleaners franchisee, understanding this definition is crucial because it directly affects the amount of royalties and other fees payable to the franchisor. By excluding sales taxes and customer discounts/refunds from Gross Revenues, the franchisee benefits from a slightly lower royalty and marketing fund contribution base, which can improve profitability. It is important for franchisees to accurately track and report these exclusions to ensure correct fee calculations.