How does Annex Brands define the term "median" in the context of financial performance?

According to Annex Brands' 2025 Franchise Disclosure Document, the median is defined as the numerical value of the data point in the middle of a dataset. If the dataset contains an even number of data points, the median is calculated by identifying the two data points in the middle, adding their numerical values, and dividing by two. This is different from the average, which is calculated by summing all data points and dividing by the number of data points.

Understanding the median gross sales for Annex Brands franchises can be valuable for prospective franchisees. It provides a measure of the central tendency of sales performance, which can be more representative than the average, especially when there are outliers (very high or very low sales figures) that could skew the average. For example, in Chart 1, the median annual gross sales for all franchised centers is $365,000, while the average is $407,000. This suggests that there are some high-performing locations pulling the average upward.

Annex Brands provides median sales figures for different subsets of franchises, such as the upper 50% and lower 50% of performers. This allows potential franchisees to understand the range of performance within the franchise system. For instance, the median annual gross sales for the upper 50% of franchises that attended the 2023 National Convention is $511,000, while for the lower 50%, it is $253,000. These figures give a more nuanced view of potential earnings based on performance level.

It is important to note that these gross sales figures do not reflect costs such as cost of sales, payroll, rent, or income taxes. A prospective Annex Brands franchisee should consider these expenses when evaluating the potential profitability of a franchise. Additionally, Annex Brands notes that the gross sales attainable by a franchisee are largely dependent on the type and quality of service offered and individual sales and marketing efforts.