What was the depreciation and amortization expense for 1 800 Packouts?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2024 | 2023 | |
|---|---|---|
| Revenues | $47,493,372 | $38,119,222 |
| Cost of revenues | 14,071,864 | 10,711,574 |
| Gross profit | 33,421,508 | 27,407,648 |
| Operating expenses: | ||
| Selling, general, and administrative | 28,732,110 | 24,077,839 |
| Depreciation and amortization | 11,953,138 | 12,782,735 |
| Total operating expenses | ||
| 40,685,248 | 36,860,574 | |
| Loss from operations | (7,263,740) | (9,452,926) |
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to the 2025 FDD, 1 800 Packouts had a depreciation and amortization expense of $12,782,735 in 2023 and $11,953,138 in 2024. This figure is a combined total of the expenses, not separated individually.
Depreciation and amortization are accounting methods used to allocate the cost of tangible (depreciation) and intangible (amortization) assets over their useful lives. For a 1 800 Packouts franchisee, these expenses reflect the wearing down or consumption of assets like equipment, vehicles, and software used in the business. These are non-cash expenses, meaning they don't involve an actual outflow of cash, but they do reduce the company's reported profit.
Understanding depreciation and amortization is important for a franchisee because it impacts the profitability and tax liability of the business. While it reduces net income, it also lowers taxable income, which can result in tax savings. Reviewing these figures over multiple years, as presented in the FDD, can help a prospective franchisee understand how 1 800 Packouts manages its assets and expenses, and how these expenses might trend in the future.
It is important to note that these figures reflect the depreciation and amortization for the entire company, not an individual franchise location. A prospective franchisee should develop their own projections for these expenses based on their specific circumstances, including the assets they will acquire and their expected useful lives. Consulting with a financial advisor is recommended to fully understand the implications of these expenses for their business.