Are amounts received away from the HydroDog vehicle included in Gross Sales?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
- 6.10 Definition of Gross Sales. As used in this Agreement, the term "Gross Sales" means all revenue you derive from operating your HydroDog Business, including, but not limited to, all amounts you receive at or away from the HydroDog Vehicle from any Services, Products or activities whatsoever including any that are in any way associated with the Marks, Copyrights or System, and whether from cash, check, barter, credit or debit card or credit transactions, including the redemption value of gift certificates redeemed by you regardless of whether such gift certificates are issued by you or someone else; but excluding: (1) all federal, state or municipal sales, use or service taxes collected from customers and paid to the appropriate taxing authority; and (2) customer refunds, adjustments, credits and allowances actually made by your HydroDog Business.
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, Gross Sales include all revenue derived from operating the HydroDog business, including amounts received both at and away from the HydroDog vehicle. This encompasses revenue from any services, products, or activities associated with Hydrodog's trademarks, copyrights, or system. This revenue is counted regardless of whether it's received via cash, check, barter, credit/debit card, or credit transactions, including the redemption of gift certificates.
However, there are some exclusions from the definition of Gross Sales. These exclusions include sales, use, or service taxes collected from customers and remitted to the appropriate taxing authority. Additionally, customer refunds, adjustments, credits, and allowances actually made by the HydroDog business are also excluded from Gross Sales.
This definition is important for franchisees because royalties are typically calculated as a percentage of Gross Sales. Therefore, understanding what constitutes Gross Sales is crucial for accurately calculating and reporting royalty payments to Hydrodog. Franchisees should ensure they are including all applicable revenue sources in their Gross Sales calculations while also properly excluding any allowable deductions to avoid underreporting or overreporting their sales figures.