Does Annex Brands independently verify the accuracy of the sales reports submitted by franchisees?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
We prepared the information above from sales reports submitted by the centers. Those reports are not audited, and we have not undertaken to independently verify the accuracy of the
information. However, we know of no instance in which, and have no reason to believe that, any centers overstated their Gross Sales or Gross Receipts in any reports.
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- There are no material differences between the operation of, or the products or services offered by, the centers whose results are reported above, and the franchises we currently offer.
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- We will make written substantiation of the information above available to you on reasonable request. This analysis is intended to be used as a reference when you conduct due diligence before signing our franchise agreement.
Source: Item 19 — Financial Performance Representations (FDD pages 74–78)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, the gross sales figures reported by franchisees are not independently audited or verified by Annex Brands. The financial performance representations provided in Item 19 are based on sales reports submitted by the franchised centers. While Annex Brands states they have no reason to believe that any centers have overstated their Gross Sales or Gross Receipts, they do not undertake independent verification of the accuracy of the information provided in these reports.
This means that the financial data presented, such as average, median, and range of gross sales, relies on the accuracy of the reports submitted by franchisees, which are not audited by Annex Brands. A prospective franchisee should be aware that these figures are based on unverified data. While Annex Brands offers to provide written substantiation of the information upon reasonable request, the underlying data remains unverified.
Given that the sales figures are not verified, it is crucial for potential franchisees to conduct their own due diligence. Annex Brands recommends that prospective franchisees make their own independent investigation to determine whether a center may be profitable and consult with legal, accounting, and other business advisors before signing the franchise agreement. This independent verification is a standard practice in franchising, as relying solely on unaudited data can carry financial risks. Franchisees should consider requesting access to the records of existing outlets, if available, to gain a more accurate understanding of potential financial performance.