Are sales of used equipment included in the Gross Sales of a Desi District franchise?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
systems, formulas, techniques, designs, layouts, operating procedures, customer data, information and know-how.
- "Gross Sales" means the total dollar amount of all sales generated through the Business for a given period, including, but not limited to, payment for any services or products sold by Franchisee, whether for cash or credit. Gross Sales does not include (i) bona fide refunds to customers, (ii) sales taxes collected by Franchisee, (iii) sales of used equipment not in the ordinary course of
business, or (iv) sales of prepaid cards or simila
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, the definition of Gross Sales includes the total dollar amount of all sales generated through the Business for a given period, including payments for any services or products sold by the Franchisee, whether for cash or credit. However, there are some exclusions to this definition.
Specifically, Gross Sales does not include bona fide refunds to customers, sales taxes collected by the Franchisee, or sales of prepaid cards or similar products (although the redemption of such cards or products will be included). Importantly, the definition of Gross Sales also excludes sales of used equipment not in the ordinary course of business.
For a prospective Desi District franchisee, this means that while most sales contribute to the Gross Sales figure used to calculate royalties and other fees, revenue from occasional sales of used equipment (outside of normal business operations) is not included in Gross Sales. This distinction can affect the franchisee's reported revenue and royalty obligations.