What was the deferred franchise fees amount for Apricot Lane in 2023?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
totaling $207,000 and $571,500 were receivable at December 31, 2023 and 2022 respectively. Franchise fees received as income from new store openings in 2023 and 2022 were $994,000 and $1,373,000 respectively. In accordance with the Company's accounting policy described in Note 1, recognition of such fees as revenue is deferred until the store opens. As a result, the Company
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to Apricot Lane's 2025 Franchise Disclosure Document, the company had deferred revenue of $627,500 at December 31, 2023. This deferred revenue relates to franchise fees.
This means that Apricot Lane received franchise fees but, according to their accounting policies, did not recognize them as revenue on their income statement until a later date. In Apricot Lane's case, revenue recognition is deferred until the store opens.
For a prospective Apricot Lane franchisee, this indicates that the franchisor is holding a significant amount of franchise fees as deferred revenue, which could reflect a pipeline of stores that are expected to open in the near future. It also shows how the franchisor recognizes revenue, which is important for understanding their financial statements.