For reporting purposes, how does Cinnabon define 'Gross Sales'?

According to Cinnabon's 2025 Franchise Disclosure Document, 'Gross Sales' is defined specifically for reporting purposes, and it differs from how 'Net Sales' are calculated for royalty fees and advertising contributions. For reporting to Cinnabon, 'Gross Sales' means 'Net Sales' plus the amount of any discounts from redemptions of coupons, and other reductions made to calculate 'Net Sales'.

This distinction is important for a prospective Cinnabon franchisee because it clarifies that while royalty and advertising fees are based on 'Net Sales' (which factors in deductions), the financial statements submitted to Cinnabon must reflect a 'Gross Sales' figure that adds back those deductions. This ensures that Cinnabon receives a comprehensive view of the store's total revenue before any discounts or reductions.

Cinnabon requires franchisees to submit a profit and loss statement and balance sheet for the last fiscal year by February 1st of each year, or another date specified in writing. These statements must be certified as true and correct by the franchisee. Cinnabon retains the right to demand audited financial statements if a financial-related default has occurred within the last calendar year. Franchisees must also provide copies of all tax returns within 90 days of Cinnabon's request and accurately record all revenues the franchised business receives or is entitled to receive.