Does Crown Gold Exchange include the sale of prepaid cards in Gross Sales?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
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- "Gross Sales" is defined in our franchise agreement as the total dollar amount of all sales generated through your business for a given period, including, but not limited to, payment for any services or products sold by you, whether for cash or credit. Gross Sales does not include (i) bona fide refunds to customers, (ii) sales taxes collected, (iii) sale of used equipment not in the ordinary course of business, or (iv) sales of prepaid cards or similar products (but the redemption of any such card or product will be included in Gross Sales).
Source: Item 6 — OTHER FEES (FDD pages 10–12)
What This Means (2024 FDD)
According to Crown Gold Exchange's 2024 Franchise Disclosure Document, the sale of prepaid cards is not included in gross sales. However, the redemption of prepaid cards is included in gross sales. Gross sales are defined as the total dollar amount of all sales generated through your business for a given period, including payment for any services or products sold, whether for cash or credit.
For a prospective Crown Gold Exchange franchisee, this means that when you initially sell a prepaid card, that transaction does not count towards your gross sales figures on which royalties are based. However, when a customer uses the prepaid card to purchase goods or services at your Crown Gold Exchange location, the value of that redemption is included in your gross sales.
This distinction is important for franchisees to understand, as it affects the calculation of royalty fees and other financial obligations to Crown Gold Exchange. Franchisees should keep accurate records of both prepaid card sales and redemptions to ensure proper reporting and avoid potential discrepancies or audits.