How did Annex Brands' revenue from merchandise and equipment sales change from 2022 to 2024?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| Revenue: Continuing franchise fees Freight Insurance, customer referrals and other Merchandise and equipment sales Unit franchises sold | $ 14,919,000 | $ 15,167,000 | $ 15,260,000 |
| 2,487,000 | 3,985,000 | 3,594,000 | |
| 6,196,000 | 4,223,000 | 4,179,000 | |
| 661,000 | 775,000 | 634,000 |
Source: Item 21 — Financial Statements (FDD page 109)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, the revenue from merchandise and equipment sales has fluctuated between 2022 and 2024. In 2022, Annex Brands reported $4,179,000 in merchandise and equipment sales. This figure increased to $4,223,000 in 2023, showing a slight increase from the previous year. However, in 2024, the revenue from merchandise and equipment sales significantly increased to $6,196,000.
This change in revenue from merchandise and equipment sales indicates a potentially growing demand for these products among Annex Brands franchisees or an increase in the prices of these items. For a prospective franchisee, this trend could suggest a promising opportunity to generate revenue through merchandise and equipment sales, in addition to the standard franchise fees and services. It's important to note that these figures reflect gross sales and do not account for the cost of goods sold or other expenses associated with these sales.
Prospective franchisees should investigate the reasons behind the increase in merchandise and equipment sales. Understanding whether the increase is due to higher volume, price increases, or changes in product mix can help in forecasting potential revenue streams. Additionally, it would be prudent to compare these figures with those of similar franchises within the Annex Brands system to gauge performance relative to peers.
It is also important to consider the costs associated with merchandise and equipment sales, as detailed elsewhere in the financial statements. While revenue increased, the profitability of these sales depends on the cost of goods sold and any related expenses. A thorough understanding of these factors is crucial for making an informed investment decision.