What was the net goodwill for 1 800 Packouts as of December 3, 2021?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
expressing an opinion on the\neffectiveness of the Company's internal control. Accordingly, no such opinion is expressed.
- Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
- Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
Tanner LLC
April 30, 2023
| As of December 3: | ||||
|---|---|---|---|---|
| 2022 | 2021 | |||
| Assets |
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, the net goodwill as of December 3, 2021, was $39,262,725. This figure represents the intangible asset value associated with the 1 800 Packouts brand and its established business operations at that time. Goodwill often arises during the acquisition of a company when the purchase price exceeds the fair value of the identifiable net assets acquired.
For a prospective 1 800 Packouts franchisee, understanding the goodwill value can provide insight into the perceived value and brand strength of the franchise system. A higher goodwill value typically indicates a stronger brand reputation and customer base, which can be beneficial for attracting customers and securing financing. However, it's important to note that goodwill is an intangible asset and its value can fluctuate based on various factors, including changes in market conditions, brand perception, and the overall performance of the franchise system.
It's also worth noting that the FDD includes information about the amortization of goodwill and intangible assets. Amortization is the process of expensing the cost of an intangible asset over its useful life. In 2022, the amortization of goodwill and intangible assets was $10,568,470, while for the period from April 9, 2021, through December 31, 2021, it was $2,543,033. This amortization expense can impact the company's net income and should be considered when evaluating the financial performance of 1 800 Packouts.
Prospective franchisees should also be aware of any legal settlements related to the acquisition of 1 800 Packouts, as these can affect the company's financial position and future performance. For example, in 2024, the company entered into a settlement agreement related to claims made under the indemnity clause of the purchase agreement for the 2022 acquisition of 1-800 Packouts, LLC. Understanding these types of financial events can provide a more comprehensive view of the franchise's financial health and stability.