What is included in 'Gross Sales' for a Precision Door Service franchise, and what is excluded?
Precision_Door_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
- G. "Gross Sales" include the total revenues and receipts from whatever source (whether in the form of cash, credit, agreement to pay, barter, trade or other consideration) that arise, directly or indirectly, from the operation of or in connection with your Business whether under any of the Marks or otherwise.
Gross Sales exclude sales taxes collected from Customers and paid to the appropriate taxing authority and any other bona fide refunds, rebates or discounts that we authorize in writing.
Gross Sales also exclude sales from any Excluded Services (as defined in a mutually executed Excluded Services Addendum (attached as Schedule H hereto)).
Source: Item 22 — Contracts (FDD pages 91–92)
What This Means (2025 FDD)
According to the 2025 Precision Door Service FDD, "Gross Sales" is defined as the total revenue and receipts from any source related to the operation of the business, including cash, credit, agreements to pay, barter, trade, or other forms of consideration, whether directly or indirectly connected to the business and its trademarks. This broad definition means that virtually all income streams associated with the Precision Door Service business are included in gross sales.
However, the FDD also specifies certain exclusions from gross sales. These exclusions include sales taxes collected from customers and remitted to the appropriate taxing authority. Additionally, any legitimate refunds, rebates, or discounts that Precision Door Service authorizes in writing are also excluded from gross sales. Gross Sales also exclude sales from any Excluded Services as defined in a mutually executed Excluded Services Addendum.
Understanding what constitutes "Gross Sales" is crucial for a Precision Door Service franchisee because many of the franchisee's financial obligations to the franchisor, such as license fees and MAP fees, are calculated as a percentage of gross sales. Therefore, accurately tracking and reporting gross sales is essential for compliance with the franchise agreement and for managing the franchisee's financial performance. Prospective franchisees should pay close attention to the definitions and exclusions to ensure they correctly calculate and report their gross sales.