Does the definition of 'Gross Sales' for a Gold Star franchise include revenues earned off-premises?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
Note 1: The term "Gross Sales" means the total of all revenues generated by Franchisee from any source, whether from cash sales or charge sales, whether based on activities conducted at the Store or otherwise associated with the business and including without limitation any revenues earned off-premises, such as delivery, catering events, food trucks, etc., without reserve or deduction for uncollected credit accounts. "Gross Sales" shall not include sales taxes that are separately stated and collected by Franchisee or refunds, discounts or allowances that are made to customers, in good faith and consistent with Gold Star's policies prescribed from time to time.
Source: Item 6 — OTHER FEES (FDD pages 12–18)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the definition of "Gross Sales" includes revenues earned off-premises. This means that all revenue generated by a franchisee, regardless of where it is earned, is included in the calculation of gross sales.\n\nSpecifically, the FDD states that "Gross Sales" includes all revenues generated from any source, whether from cash or charge sales, and whether the activities are conducted at the store or are associated with the business. This explicitly includes revenues earned off-premises, such as from delivery, catering events, and food trucks. This is a comprehensive definition that aims to capture all possible revenue streams associated with the Gold Star franchise. \n\nFor a prospective franchisee, this means that the Continuing Franchise Fee, as well as other fees calculated as a percentage of Gross Sales, will be based on all revenue, including off-premises sales. However, "Gross Sales" does not include sales taxes that are separately stated and collected, or refunds, discounts, or allowances made to customers in good faith and consistent with Gold Star's policies. This is a fairly standard definition of gross sales in the franchise industry, as it aims to capture the total revenue generated by the business before deductions for certain items like taxes and discounts.