How are customer refunds handled in the 'Net Sales' calculation for a Marble Slab Creamery?
Marble_Slab_Creamery Franchise · 2025 FDDAnswer from 2025 FDD Document
The term "Net Sales" does not include: (i) the amount of any valid and active coupons or similar discounts that a customer redeems in connection with a given sale (except as may be reimbursed by us); (ii) sales taxes levied upon retail sales if you must subsequently pay such taxes to the appropriate governmental authorities; (iii) good faith customer refunds as determined in accordance with the requirements of the Manual; and (iv) occasional sales of fixtures or other capital items sold by you after use in the operation of your Restaurant.
Revenue from the sale of gift cards is not recognized as "Net Sales" until redeemed at your Restaurant, but "Net Sales" does not include the amount of bona fide refunds paid to customers, the amount of any state or local sales or use tax actually paid by you and sales of fixtures or other capital items sold by you after use of them in the operation of your Restaurant.
No other deductions apply, for example the fees paid to authorized vendors who deliver food and beverages to your customers who place orders from inside or outside
Source: Item 6 — OTHER FEES (FDD pages 23–32)
What This Means (2025 FDD)
According to the 2025 Marble Slab Creamery Franchise Disclosure Document, 'Net Sales' is a crucial figure used to calculate royalty and national advertising fund payments. The document specifies that 'Net Sales' includes all revenue and receipts from the sale of food, beverages, merchandise, and services at the restaurant, regardless of whether the payment is made in cash, services, property, or barter. This also includes revenue from carryout, delivery, service fees, catering services, and off-site events.
However, the calculation of 'Net Sales' does allow for some deductions. Specifically, 'Net Sales' does not include good faith customer refunds, provided these refunds are determined in accordance with the requirements outlined in the Marble Slab Creamery manual. This means that if a customer is legitimately due a refund, the amount of that refund can be subtracted from the total revenue when calculating 'Net Sales'.
Additionally, 'Net Sales' does not include sales taxes that the franchisee must subsequently pay to governmental authorities, or revenue from the occasional sale of fixtures or other capital items after their use in the restaurant. Revenue from the sale of gift cards is also excluded from 'Net Sales' until the gift cards are actually redeemed at the restaurant. It is important to note that no other deductions apply, including fees paid to authorized third-party delivery services.