What is the typical initial term of most Batteries Plus Bulbs leases?

According to the 2025 Batteries Plus Bulbs FDD, the typical initial lease term for retail stores, warehouse facilities, administrative offices, and equipment is between one and five years. These leases often include one to three optional renewal periods, each lasting one to five years.

For a prospective franchisee, this means that when securing a location for their Batteries Plus Bulbs store, they can generally expect to sign a lease with an initial term in that one-to-five-year range. The availability of renewal options provides some flexibility, allowing franchisees to extend their lease if their business is thriving and they wish to remain in the same location. However, the decision to exercise these renewal options rests solely with Batteries Plus Bulbs.

Batteries Plus Bulbs evaluates renewal options at the beginning of the lease and on an ongoing basis, and includes options that are reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. This suggests that Batteries Plus Bulbs takes a proactive approach to lease management, carefully considering its long-term needs and commitments. Franchisees should discuss lease terms and renewal possibilities thoroughly with Batteries Plus Bulbs during the site selection and lease negotiation process.

It's also important to note that leases with an original term of 12 months or less are not recognized on the company's consolidated balance sheets, and the lease expense related to these short-term leases is recognized over the lease term. However, the document states that in 2023 and 2022, the company did not have any short-term leases.