How is the EBITDA (if franchised) figure calculated for Beauty Bungalows franchisees?
Beauty_Bungalows Franchise · 2025 FDDAnswer from 2025 FDD Document
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- EBITDA (if franchised) – "EBITDA (if franchised)" does not include expenses related to taxes, interest on debt, depreciation, or amortization costs.
The numbers included in this figure are equal to the Gross Revenue, minus the Total Key Operating Expenses and Estimated Franchise Operating Expenses, for each Measurement Period.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 40–45)
What This Means (2025 FDD)
According to Beauty Bungalows' 2025 Franchise Disclosure Document, the EBITDA (if franchised) is calculated by subtracting the Total Key Operating Expenses and Estimated Franchise Operating Expenses from the Gross Revenue for each measurement period. The document specifies that this EBITDA figure does not include expenses related to taxes, interest on debt, depreciation, or amortization costs.
For prospective Beauty Bungalows franchisees, understanding this calculation is crucial for assessing potential profitability. The Gross Revenue includes all amounts collected from suite rental income, excluding taxes collected and paid to government agencies. The Total Key Operating Expenses encompass costs such as advertising, cleaning supplies, insurance, janitorial services, legal/licenses, rent, repairs & maintenance, utilities, and bank fees. The Estimated Franchise Operating Expenses include Royalty Fees (5.5% of Gross Revenue), Brand Fund Contribution (1% of Gross Revenue), and Technology Fees.
It's important to note that the EBITDA (if franchised) figures presented in Item 19 are based on the performance of Beauty Bungalows' company-owned outlets and include estimated expenses that a franchisee would incur. These figures are intended to provide an example of potential financial performance, but Beauty Bungalows cautions that individual results may vary. The FDD also states that pre-opening costs are not reflected in these calculations, so franchisees should refer to Item 7 for those details and conduct their own independent investigation of costs and expenses.
By carefully reviewing these components and understanding how they contribute to the EBITDA (if franchised) calculation, potential Beauty Bungalows franchisees can gain a clearer picture of the investment required and the potential returns. However, they should also consider the 'Some outlets have sold this amount. Your individual results may differ. There is no assurance you will sell as much' disclaimer and conduct thorough due diligence.