How does Ben Jerrys reimburse Homemade and Conopco, Inc. for services performed on its behalf?
Ben_Jerrys Franchise · 2025 FDDAnswer from 2025 FDD Document
| INTERIM Q1 2025 Financial Statements Unaudited | | |---|---| | As of March 31, 2025 | | | | | | Ben & Jerry's Franchising, Inc. | | | Balance Sheet | | | (In thousands) | | | | | | Assets | | | Current assets: | | | Cash | $ 1 ,503 | | Accounts Receivable, less allowance for doubtful accounts | | | of $45 and $115 at March 31, 2022 and 2021, respectively | 363 | | Due from parent, net | 3 7,043 | | Inventories | 192 | | Prepaid expenses and other current assets | 228 | | Total current assets | 3 9,329 | | | | | Deferred tax assets | 472 | | Fixed assets, net | 388 | | Right of use assets, operating | 250 | | | | | Intangible assets, net | 705 | | Total assets | 4 1,144 | | | | | | | | Liabilities and Equity | | | Current liabilities: | | | Accounts payable | $ 673 | | Accrued liabilities | 1,193 | | Due to related party | 1 9,399 | | Current tax liabilities | 458 | | Current portion of operating lease liability | 79 | | Deferred revenue | 73 | | Total current liabilities | 2 1,875 | | | | | Deferred revenue, non-current | 333 | | Non-current portion of operating lease liability | 190 | | Total liabilities | 2 2,398 | | | | | Equity: | | | Additional paid-in capital | 1 4,311 | | Retained earnings | 4,435 | | | | | Total equity | 1 8,745 | | Total liabilities and equity | $ 41,144 | The estimated revenue in the table above does not contemplate future franchise renewals or new franchise agreements for which a franchise agreement does not exist at December 31, 2024.
(8) Transactions with Parent
Homemade, and its parent, Conopco, Inc., perform a number of services on behalf of the Company. These services include cash management, the processing of accounts payable and payroll, and the payment of workers compensation, insurance, and income taxes. The Company reimburses
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 89–133)
What This Means (2025 FDD)
According to Ben Jerrys's 2025 Franchise Disclosure Document, Homemade, Inc. and its parent company, Conopco, Inc., provide various services to Ben Jerrys, including cash management, processing accounts payable and payroll, and handling payments for workers' compensation, insurance, and income taxes. Ben Jerrys reimburses Homemade and Conopco for the full amount of these processed and/or paid expenses.
The consolidated financial statements include allocations from Homemade and Conopco for these expenses. In 2024, these allocations included approximately $5,011 for personnel costs, $125 for rent and utility costs, and $232 for other services. In 2023, the allocations included approximately $5,203 for personnel costs, $117 for rent and utility costs, and $178 for other services.
This arrangement indicates that Ben Jerrys relies on its parent and related company for essential administrative and financial functions. As a prospective franchisee, it's important to understand the nature and extent of these intercompany services and how they might affect the financial performance and stability of Ben Jerrys. Understanding these relationships can provide insight into the operational dependencies and potential risks associated with the franchise.