What were the COVID-19 related costs incurred by Benihana in 2022?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
se termination expense was $0.3 million and $1.9 million in 2022 and 2021, respectively. Lease termination expenses are costs associated with closed, abandoned and disputed locations or disputed leases.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, the company incurred $2.5 million in COVID-19 related expenses in 2022. These costs primarily covered sanitation, supplies, and safety precautions implemented to prevent the spread of COVID-19. This figure is lower than the $5.8 million spent in 2021 for the same purpose, indicating a decrease in COVID-19 related expenses year over year.
For a prospective Benihana franchisee, understanding these costs is crucial for financial planning. While the costs decreased from 2021 to 2022, they still represent a significant expense that impacts the overall profitability of the business. Franchisees need to be prepared for potential fluctuations in these costs depending on the prevailing health conditions and any mandated safety measures.
It's important to note that these expenses are in addition to the standard operating costs and can affect the financial performance of a Benihana franchise. Franchisees should consider these factors when projecting their earnings and managing their budgets. While the FDD provides historical data, future COVID-19 related expenses may vary based on evolving circumstances and public health guidelines.