For Chop5 Salad Kitchen, does the definition of 'Gross Sales' exclude amounts refunded to customers?

According to Chop5 Salad Kitchen's 2024 Franchise Disclosure Document, the definition of Gross Sales does exclude amounts refunded to customers. Gross Sales are defined as all gross sums you bill or collect from all goods and services you sell, plus all other sums you collect from the operation of your Restaurant, including any advertising revenues, sponsorship fees and business interruption insurance proceeds.

Specifically, the document states that Gross Sales excludes several items, including sales or use taxes, amounts refunded to customers, revenues from the sale of furniture, fixtures and equipment in the ordinary course of business, the value of approved coupons, vouchers or similar items at the time of redemption, and tips paid to and retained by staff members as a gratuity.

This definition is important for prospective franchisees because many fees payable to Chop5 Salad Kitchen, such as the Brand Fund Fee and Local Advertising Commitment, are calculated as a percentage of Gross Sales. By excluding refunds from the calculation of Gross Sales, the franchisee's fee obligations are reduced, reflecting a more accurate representation of the restaurant's actual revenue.