What is the definition of 'Gross Revenues' in the context of reporting requirements for a Southern Steer franchise?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- 30.28.
Gross Revenues. "Gross Revenues" will mean the total Dollar sales from all guests or customers of the Franchisee's Southern Steer Business, and will include all cash, credit card, and credit sales made by the Franchisee of every kind and nature made at, from, by or in connection with the Franchisee's Southern Steer Business including, but not limited to, all Dollars and income received from the following: (a) the sale of all Foods, Beverages and Products, including alcoholic and nonalcoholic beverages and drinks; (b) the sale of any and all goods, products, food items, merchandise or items sold at or through the Southern Steer Business, (c) the sale of any and all goods, products, food items, merchandise or items sold under any of the Marks; (d) all sales from the catering of Foods, Beverages and Products; (e) all sales from the delivery of Foods, Beverages and Products; (f) all sales of Foods, Beverages or Products for any banquet service; (g) all sales from the carry-out of Foods, Beverages and Products; (h) all sales of Foods, Beverages and Products at any locations or sites other than the Franchised Location; (i) all payments received from or for the redemption of gift cards and gift certificates by the Franchisee's Southern Steer Business; (j) all payments received from business interruption insurance payments made to the Franchisee by any insurance company; (k) the sale of all Foods, Beverages and Products to its employees including sales from discounted meals provided to employees and actually paid for by employees; and (l) all sales of Foods, Beverages and Products on a wholesale basis. "Gross Revenues" will not include (i) any sales, use or gross receipts tax imposed by any Governmental Authority directly upon sales, if the amount of the tax is added to the selling price and is charged to the customer, a specific record is made at the time of each sale of the amount of such tax, and the amount of such tax is paid to the appropriate taxing authority by the Franchisee; (ii) the sale (as opposed to the redemption) of gift cards by the Franchisee's Southern Steer Business; (iii) the value of Foods, Beverages and Products offered on a limited complementary basis by the Franchisee; (iv) the one-time sale of any FF&E or any inventory items to a purchaser;(v) monetary refunds actually paid back to customers for Foods, Beverages and Products; and (vi) in the event Food, Beverages and Products are sold to customers of Franchisee's Southern Steer Business at a discount in accordance with a Loyalty Program or other promotion approved by Franchisor in writing, only the amount collected
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, Gross Revenues are defined as the total dollar sales from all guests or customers of the Southern Steer Business. This includes all cash, credit card, and credit sales of every kind and nature made at, from, by, or in connection with the Southern Steer Business. Specifically, this encompasses income from the sale of all foods, beverages, and products (including alcoholic and nonalcoholic drinks), all goods and merchandise sold at or through the business, sales from catering and delivery, banquet services, carry-out, sales at locations other than the franchised location, payments from gift card redemptions, business interruption insurance payments, sales to employees, and wholesale sales.
However, the definition of Gross Revenues for a Southern Steer franchise excludes certain items. These exclusions include any sales, use, or gross receipts tax imposed by a Governmental Authority directly upon sales, provided the tax amount is added to the selling price, recorded at the time of sale, and paid to the appropriate taxing authority. Gross Revenues also exclude the sale of gift cards (but includes their redemption), the value of complimentary items offered on a limited basis, one-time sales of FF&E or inventory, and monetary refunds paid back to customers. Additionally, discounts given in accordance with a Loyalty Program or other promotion approved by Southern Steer in writing are deducted from the gross revenue calculation, with only the amount collected from the customer being included.
For a prospective Southern Steer franchisee, understanding this definition is crucial because royalty fees and brand fund contributions are calculated as a percentage of Gross Revenues. Accurate reporting of Gross Revenues is essential to avoid penalties, such as having to cover the costs of an audit if revenues are understated by more than 2%. Furthermore, Southern Steer has the right to disclose information relating to the business, including Gross Revenues, in its Franchise Disclosure Document and other documents.