For Corcoran franchisees, what is included in the definition of 'Gross Revenue'?
Corcoran Franchise · 2025 FDDAnswer from 2025 FDD Document
[3] "Gross Revenue" includes all compensation (including all revenues and commissions whether or not other individuals or entities are entitled to retain those revenues or commissions) received (or receivable) in connection with the Business, including revenue from new development services, transactions and services that require a real estate or auctioneer's license and/or in which you use the Marks or the System in any manner, before the deduction of any fees, costs or expenses you incur,
except for certain referral fees you pay to various sources. Any amounts deposited in the Business's bank accounts will be deemed Gross Revenue earned in compliance with all laws unless proven otherwise.
Source: Item 6 — OTHER FEES [1] [2] (FDD pages 27–34)
What This Means (2025 FDD)
According to Corcoran's 2025 Franchise Disclosure Document, "Gross Revenue" is comprehensively defined for the purpose of calculating royalty fees and BMF contributions. It encompasses all compensation, including revenues and commissions, received or receivable by the franchisee's business. This includes income from new development services, transactions, and any services that require a real estate or auctioneer's license, especially when the Corcoran Marks or System are used. The calculation is made before deducting any fees, costs, or expenses the franchisee incurs.
However, there is an exception for certain referral fees paid to various sources, which are not included in Gross Revenue. Furthermore, any amounts deposited into the business's bank accounts are presumed to be Gross Revenue earned in compliance with all laws unless proven otherwise. This broad definition ensures that all income streams related to the Corcoran franchise are accounted for when determining the royalty and BMF contribution amounts.
For a prospective Corcoran franchisee, understanding this definition is crucial because it directly impacts the amount of royalty fees and BMF contributions payable to Corcoran. By understanding what constitutes Gross Revenue, franchisees can accurately calculate their payments and avoid potential discrepancies or disputes with the franchisor. It is also important to note that Corcoran has the right to audit franchisee records and charge audit fees if discrepancies are found, so maintaining accurate and auditable records is essential.