Is the Gross Sales calculation for Face Foundrie franchises the same calculation used for the Royalty Fee?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
For purposes of this disclosure, "Gross Sales" includes all revenue derived from the operations of a Facial Bar less sales or use tax and customer refunds, allowances, and discounts given in good faith.
Gift card revenue is recognized upon redemption.
This is the same calculation we use to calculate the Royalty Fee and other amounts under the Franchise Agreement.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 59–69)
What This Means (2025 FDD)
According to the 2025 Face Foundrie Franchise Disclosure Document, the calculation for Gross Sales is the same one used to calculate the Royalty Fee and other amounts under the Franchise Agreement. For Face Foundrie, Gross Sales includes all revenue derived from the operations of a Facial Bar, less sales or use tax, customer refunds, allowances, and discounts given in good faith. Gift card revenue is recognized upon redemption.
This means that Face Foundrie franchisees will pay their royalty fees based on this specific definition of Gross Sales. It is important for prospective franchisees to understand exactly what is included and excluded from this calculation, as it directly impacts the amount of royalties owed to Face Foundrie.
Understanding the components of Gross Sales is crucial for accurate financial planning and reporting. Franchisees should carefully track all revenue, sales taxes, refunds, and discounts to ensure they are correctly calculating their Gross Sales and, consequently, their royalty obligations to Face Foundrie.