How does Cordova define 'Gross Sales' and what deductions are taken?

According to Cordova's 2025 Franchise Disclosure Document, Gross Sales is defined as the total revenue derived by each Cordova Business, less sales tax, discounts, allowances, and returns. This means that the revenue figure used for calculating royalties and other fees is net of these specific deductions.

In reviewing the financial performance of the company-owned outlet in Omaha, Nebraska, the FDD provides a breakdown of deductions from potential gross sales. For the 2024 calendar year, the company-owned outlet's expenses included direct costs of goods and services sold, rent, utilities, office supplies, marketing, insurance, technology, and administrative and management labor costs. Additionally, adjustments were made for select franchise-related expenses such as royalty fees, technology fees, and local marketing.

It is important to note that while these deductions are detailed for the company-owned outlet, they may not fully represent the expenses a franchisee will incur. The FDD specifically mentions that the company-owned outlet benefits from managerial skill, brand recognition, and the absence of ongoing fees that a franchisee would typically pay. Therefore, prospective franchisees should carefully consider all potential expenses and revenue streams when evaluating the Cordova franchise opportunity.