What constitutes 'gross revenues' for calculating the Continuing Franchise Fee for a Healthsource Chiropractic franchise?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) "Gross revenues" means the total of all revenue and receipts derived from the operation of the franchise, including all amounts received at or away from the Clinic, or through the business the Clinic conducts (such as fees for chiropractic and/or physical therapy care, fees for the sale of any service or product, gift certificate sales, and revenue derived from products sales, whether in cash or by check, credit card, debit card, barter or exchange, or other credit transactions); and excludes only sales taxes collected from customers and paid to the appropriate taxing authority, and all customer refunds and credits the franchise actually makes. The Continuing Franchise Fee is 7%. The Continuing Franchise Fee may vary for Clinic Management Businesses in order to comply with applicable state law, which may prohibit us from charging the Continuing Franchise Fee based on "gross revenues."
Source: Item 6 — Other Fees (FDD pages 17–23)
What This Means (2025 FDD)
According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, gross revenues for the purpose of calculating the Continuing Franchise Fee include the total of all revenue and receipts derived from the operation of the franchise. This encompasses all amounts received at or away from the clinic, or through the business the clinic conducts. Specifically, this includes fees for chiropractic and/or physical therapy care, fees for the sale of any service or product, gift certificate sales, and revenue derived from product sales. These revenues are included whether received in cash, check, credit card, debit card, barter or exchange, or other credit transactions.
However, there are a couple of exceptions to what is included in gross revenues. Healthsource Chiropractic excludes sales taxes collected from customers and paid to the appropriate taxing authority. Additionally, all customer refunds and credits that the franchise actually makes are also excluded from the gross revenue calculation.
The standard Continuing Franchise Fee is 7% of gross revenues. The FDD notes that this fee may vary for Clinic Management Businesses in order to comply with applicable state law, which may prohibit Healthsource Chiropractic from charging the Continuing Franchise Fee based on "gross revenues."
It is important for prospective franchisees to understand exactly how gross revenues are defined, as this figure directly impacts the amount of the Continuing Franchise Fee owed to Healthsource Chiropractic. Franchisees should also be aware of the specific payment methods and the potential for automatic debits from their accounts to cover these fees, as well as the financial implications of failing to report gross revenues accurately or on time.