For Cicis, what is included in the definition of 'Net Sales'?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
payable to us.
- (2) "Net Sales" means all sales, revenues, charges and receipts received by you from your Cicis Restaurant or attributed to your Cicis Restaurant, including all revenue that is generated from the operation of any video game machines (including bulk machines) located at your Cicis Restaurant, whether from cash, check, credit or debit card, gift cards, barter exchange, trade credit or other credit transactions, but excludes (i) Sales Tax (as defined below), (ii) any refunds made for your customers, and (iii) receipts from the sale of products from vending machines located at your Cicis Restaurant. Net Sales also includes all insurance proceeds you receive to replace revenue that you lose from the interruption of your Cicis Restaurant due to a casualty or other event covered by business interruption or similar insurance coverage. "Sales Tax" means all taxes collected directly from customers, based upon present or future Law, collected by you in the operation of your Cicis Restaurant, and any other tax, excise, or duty which is levied or assessed against you by any federal, state, municipal, or local authority, based on sales of specific merchandise sold at or from your Cicis Restaurant, provided that such taxes are actually transmitted to the appropriate taxing authority. We may authorize certain other items to be excluded from Net Sales. We may, in our discretion, revoke or withdraw any such permission at any time.
Source: Item 6 — OTHER FEES (FDD pages 14–21)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, 'Net Sales' encompasses all income received by a franchisee's Cicis restaurant. This includes revenue from various sources such as cash, checks, credit or debit cards, gift cards, barter exchange, trade credit, and other credit transactions. Specifically, it also incorporates revenue generated from video game machines (including bulk machines) located within the Cicis restaurant.
However, the definition of 'Net Sales' for Cicis excludes certain items. These exclusions are sales tax collected directly from customers, refunds made to customers, and receipts from the sale of products from vending machines located at the Cicis Restaurant. Additionally, Cicis may authorize other items to be excluded from Net Sales at their discretion, and they retain the right to revoke or withdraw such permission at any time.
Notably, 'Net Sales' also includes any insurance proceeds a franchisee receives to compensate for lost revenue due to business interruption caused by a casualty or other event covered by business interruption insurance. This comprehensive definition of 'Net Sales' is crucial because many fees, including the royalty fee (5% of Net Sales for a Cicis Buffet Restaurant or 6% of Net Sales for a Cicis To Go Restaurant), are calculated based on this figure. Understanding what constitutes 'Net Sales' is essential for franchisees to accurately calculate their financial obligations to Cicis.