What was the cash balance at the beginning of the period for 7 Brew as of December 31, 2023?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
ber 29, 2024 | $ 17,776,440 |
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| December 29, 2024 | December 31, 2023 | December 25, 2022 | |
|---|---|---|---|
| Operating Activities | $ 18,388,782 | $ 1,560,891 | $ (2,563,076) |
| Net income (loss) | |||
| Adjustments to reconcile net income (loss) to net cash | |||
| provided by operating activities Depreciation and amortization Operating lease asset/liability Loss on disposal of software in development Gift card breakage | 55,238 12,550 693,200 (1,485,646) | 19,643 35,666 - - | 9,407 - - - |
| Changes in Accounts receivable Prepaid expenses and other current assets Accounts payable and accrued expenses Deferred franchise fees | (848,299) (1,600,294) 5,954,321 4,428,639 | (135,935) (176,538) 2,074,593 8,509,758 | (537,588) (43,392) 1,878,039 9,312,180 |
| Net cash provided by operating activities | 25,598,491 | 11,888,078 | 8,055,570 |
| Investing Activities Purchase of property and equipment Advances to Parent Net cash used in investing activities | (941,616) (3,949,623) (4,891,239) | (421,290) (12,999,978) (13,421,268) | (60,581) (13,593,164) (13,653,745) |
| Increase (Decrease) in Cash | 20,707,252 | (1,533,190) | (5,598,175) |
| Cash, Beginning of Period | 2,111,088 | 3,644,278 | 9,242,453 |
| Cash, End of Period | $ 22,818,340 | $ 2,111,088 | $ 3,644,278 |
| Supplemental Non-Cash Activities Right-of-use asset obtained in exchange for new operating lease liability Accounts payable and accrued expenses relating to purchases of f |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 82)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, the cash balance at the beginning of the period as of December 31, 2023, was $3,644,278. This figure represents the amount of cash 7 Brew had on hand at the start of its fiscal year that ended on December 31, 2023. This information is derived from the audited financial statements included in the FDD. The cash balance is a key indicator of the company's liquidity and its ability to meet short-term obligations.
For a prospective franchisee, understanding the franchisor's cash position is crucial. A healthy cash balance suggests financial stability and the ability to support franchisees. It can also indicate the company's capacity to invest in new initiatives, marketing, and overall system improvements. Conversely, a low cash balance might raise concerns about the franchisor's ability to provide adequate support or navigate economic downturns.
The FDD also provides cash flow information, detailing how 7 Brew generates and uses cash through its operating, investing, and financing activities. Reviewing these statements can provide a more comprehensive understanding of the company's financial health and sustainability. Franchisees should analyze these figures in conjunction with other financial metrics and compare them to industry benchmarks to assess the relative strength of the 7 Brew franchise system.
It is important to note that while the FDD provides historical financial data, future performance may vary. Prospective franchisees should conduct their own due diligence, including consulting with financial advisors, to evaluate the potential risks and rewards of investing in a 7 Brew franchise. Understanding the franchisor's financial position is a critical step in making an informed investment decision.