What was the long-term portion of Aerus' notes receivable on December 31, 2024?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2024 | 2023 | |
|---|---|---|
| Notes receivable | $710,241 | $701,476 |
| Less allowance for credit losses | (677,266) | (570,045) |
| Notes receivable, net | 32,975 | 131,431 |
| Less current portion of notes receivable | (30,000) | (40,000) |
| Long-term portion of notes receivable | $2,975 | $91,431 |
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus' 2025 Franchise Disclosure Document, the long-term portion of notes receivable was $2,975 as of December 31, 2024. This figure represents the amount of money owed to Aerus by franchisees, less any current portions due within a year and an allowance for potential credit losses. Notes receivable from franchisees relates to sales of franchise rights to the Company's branch locations and certain branch assets to franchisees. The notes receivable from franchisees typically bear interest from 7-10% per annum, have original terms of three to five years, and are unsecured.
It is important to note that the notes receivable are related to financing provided to franchisees, and the long-term portion indicates the amount not expected to be collected within the next year. The notes receivable from franchisees typically bear interest from 7-10% per annum, have original terms of three to five years, and are unsecured. In 2020, Aerus began financing notes to franchisees for fees paid to become a Beyond Franchise (entitles franchise to sell items not available to other franchises). For the year ended December 31, 2024 and 2023, $24,175 and $39,980 notes were financed by the Company, respectively. These notes do not bear interest.
For a prospective franchisee, understanding the nature and terms of these notes is crucial. The notes receivable from franchisees typically bear interest from 7-10% per annum, have original terms of three to five years, and are unsecured. In 2020, Aerus began financing notes to franchisees for fees paid to become a Beyond Franchise (entitles franchise to sell items not available to other franchises). For the year ended December 31, 2024 and 2023, $24,175 and $39,980 notes were financed by the Company, respectively. These notes do not bear interest. Reviewing the trend in notes receivable and the allowance for credit losses can provide insights into the financial health of Aerus' franchisees and the potential risk associated with these receivables.