What was the amount of Bambu's non-refundable deferred franchise fees classified as long-term liabilities in the most recent year presented?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
| CURRENT LIABILITIES | |||
|---|---|---|---|
| Accounts payable and accrued expenses | $ 689,346 | $ 480,167 | |
| Current portion of non-refundable deferred franchise fees | 370,917 | 265,062 | |
| Current portion of notes payable | 37,715 | 43,293 | |
| Current portion of notes payable -members | 30,279 | ||
| Current portion of lease liability | 14,641 | 22,698 | |
| TOTAL CURRENT LIABILITIES | 1,142,898 | 811,220 | |
| LONG-TERM LIABILITIES | |||
| Non-refundable deferred franchise fees | 772,538 | 1,171,105 | |
| Lease payable | 14,641 | ||
| Notes payable | 182,615 | 211,677 | |
| Notes payable -members | 242,331 | ||
| TOTA | L LIABILITIES | 2,340,382 | 2,208,643 |
| MEMBERS' (DEFICIT) | (1,835,938) | (1,608,889) | |
| TOT AL LIABILITIES AND | |||
| MEMBERS' (DEFICIT) | $ 504,444 | $ 599,754 |
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, the amount of non-refundable deferred franchise fees classified as long-term liabilities was $772,538 for the most recent year presented. The FDD also provides the corresponding figure for the prior year, which was $1,171,105. This indicates a decrease in long-term deferred franchise fee liabilities from 2023 to 2024.
Deferred franchise fees typically represent initial franchise fees that Bambu has collected but not yet recognized as revenue. These fees are deferred because Bambu has not yet fulfilled all of its obligations to the franchisee, such as providing training or site selection assistance. As Bambu fulfills these obligations over time, the deferred revenue is recognized as earned revenue on the income statement. The portion of these fees expected to be recognized beyond the next 12 months is classified as a long-term liability.
The decrease in non-refundable deferred franchise fees classified as long-term liabilities from 2023 to 2024 could be due to several factors. Bambu may have recognized more of these fees as revenue during 2024 as they fulfilled their obligations to franchisees. It could also indicate a change in the timing of revenue recognition or a decrease in the amount of new franchise fees being deferred.
A prospective franchisee should consult with a financial advisor to understand the implications of deferred revenue and how it might affect Bambu's financial performance. Understanding the trend and reasons behind changes in deferred franchise fees can provide insights into the company's growth and revenue recognition practices.