How is 'EBITDA' calculated for Batteries Plus Bulbs, according to the FDD?

According to Batteries Plus Bulbs' 2025 Franchise Disclosure Document, EBITDA is calculated by subtracting the Total Expenses from the Gross Profit Margin. Gross Profit Margin is defined as Net Revenue less the Cost of Goods Sold. Net Revenue includes all revenues from sales of goods and services, whether for cash, check, credit card, or trade, less sales tax, discounts, customer refunds, and returns. Cost of Goods Sold includes product costs, discounts earned, customer repair costs, recycling charges, restocking fees, purchase price variances, redistribution costs, core recovery, tech center supplies, freight in, warranty expense, bulb breakage, and coupon discrepancy, but excludes inventory shrinkage and scrap.

Total Expenses include Selling Expenses, Delivery Expense, Facilities and Office expenses, Admin expenses, Royalties, and Marketing expenses. Selling Expenses cover credit card fees, national account administration fees, and uniform expenses, but exclude business meals, travel, and sample equipment. Delivery Expense includes vehicle gas, insurance, and shipping, but not vehicle repairs. Facilities and Office expenses include business insurance, rent, CAM, property tax, security, snow removal, lawn care, utilities, and waste management, but not building or equipment repairs. Admin expenses include IT data lines, IT maintenance fees, supplies, and telephone expenses, but not bad debt, cellular phone expenses, or donations.

Prospective franchisees should note that EBITDA does not account for several additional expenses they will incur. These include facility services, property taxes, rent, building and equipment repairs, security services, snow removal and lawn care, insurance, Omni Channel Fee, computer support, credit card fees, taxes, shipping expenses, vehicle expenses (including gas, insurance, and repairs), samples, service charges, supplies, postage, employee welfare, bad debt expense, donations, dues and subscriptions, payroll processing, human resources/personnel, IT support and repairs, banking fees, legal fees, tax preparation, accounting, bookkeeping, business meals and entertainment, utilities, janitorial services, waste removal services, Key Account Program administrative fees and commissions, meetings, printed selling materials, tools and small equipment, travel, uniforms, depreciation and amortization expenses, and all other miscellaneous expenses. Therefore, a franchisee's actual profit may be significantly lower than the EBITDA figures presented in the FDD.