What is the amortization period for customer relationships acquired in the Benjamin Franklin Plumbing acquisition?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
(1) Identifiable intangible assets acquired include referral relationships, trademarks, franchise relationships and non-competition agreements which will be amortized on a straight-line basis over their preliminary useful lives of 15 years, 25 years, 15 years and 1 years, respectively.
Source: Item 22 — CONTRACTS (FDD pages 87–88)
What This Means (2025 FDD)
According to the 2025 FDD, the identifiable intangible assets acquired in the Benjamin Franklin Plumbing business include referral relationships, trademarks, franchise relationships, and non-competition agreements. These assets are amortized using the straight-line method over their estimated useful lives.
Specifically, referral relationships and franchise relationships are amortized over 15 years, trademarks over 25 years, and non-competition agreements over 1 year. This means that the cost of these intangible assets is spread out as an expense over these periods, reflecting their contribution to the business over time.
For a prospective Benjamin Franklin Plumbing franchisee, understanding these amortization schedules is important for financial planning and understanding the long-term value of the acquired assets. It affects how the acquisition cost is recognized in the company's financial statements and can impact profitability calculations over the life of these assets.