For Chocolate Fish Coffee, what is included in the definition of 'Gross Sales'?

According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, 'Gross Sales' is defined as the total revenue derived from the sale of goods or services, less sales tax, discounts, and returns. This definition is important for prospective franchisees as it clarifies what revenue is subject to royalty and brand fund fees.

Specifically, Chocolate Fish Coffee franchisees will pay a percentage of their gross sales as royalty fees and to the brand fund. The FDD excerpts show examples of gross sales figures for company-owned locations, ranging from $531,854.48 to $850,850.75. These figures are used to calculate estimated royalty fees and brand fund contributions for those locations. For example, a location with gross sales of $850,850.75 would have estimated royalty fees of $51,051.05 and an estimated brand fund contribution of $8,508.51.

It is important to note that these gross sales figures do not reflect the costs of sales, operating expenses, or other costs that must be deducted to determine net income or profit. The FDD advises prospective Chocolate Fish Coffee franchisees to conduct an independent investigation of the costs and expenses they will incur in operating their business. Franchisees should also be aware that the financial performance of existing locations is not a guarantee of future performance, and individual results may vary.