NABR Infotech

NABR Infotech is a leading Web solutions company in Chennai. We provide Web Applications, E-commerce stores
and Web Portals. That help to companies growing, building and shaping in today’s market. Now it is necessary to
all kind of company to stay and grow in this competitive market. We design, develop, and maintain high quality
solutions for a wide range of businesses and unique.

www.nabrinfotech.com
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NABR Infotech

System sales is a business term used in the franchising industry. Franchisors provide supplies, marketing and administration services to franchisees in return for a part of the franchisees' revenues. Some franchisors also operate some outlets directly. System sales represents the total sales of all outlets that use a brand, or that use all the franchised brands owned by one franchisor. It is always higher than the franchisor's revenue for accounting purposes.
For example, say an average "Fast Eats" restaurant has annual revenue of US$1 million. Fast Eats Inc operates 1,000 Fast Eats restaurants directly and franchises another 3,000 outlets, taking a 20% cut of sales. Fast Eats Inc's reported revenue is $1.6 billion (1,000 × $1million from direct operations and 20% × 3,000 × $1 million from franchised outlets). But Fast Eats' system revenue is $4 billion (4,000 × $1 million).
System sales provides a useful way of assessing the growth of a franchised brand. A franchise operator can easily increase its reported revenue by taking more outlets under direct management, but that may not be the best option for the profitability of the business, and the increase in accounting revenue it generates may give a misleading impression of the rate of growth of the underlying business, if system sales are not taken into account.

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