What was the amount of stock-based compensation allocated to Benjamin Franklin Plumbing by the Parent in 2022?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
se support expenses. The consolidated statements of operations also include expense allocations for services and certain support functions that are provided on a centralized basis by Parent such as legal, business development, human resources, corporate accounting and finance, treasury and various other Parent corporate functions. These parent expenses are allocated by either specific identification or based on revenue of the Company relative to the Parent's other subsidiaries and are reflected in the consolidated
Source: Item 22 — CONTRACTS (FDD pages 87–88)
What This Means (2025 FDD)
According to Benjamin Franklin Plumbing's 2025 Franchise Disclosure Document, the Parent allocated $4,409 of stock-based compensation expense to the company in 2022. Of this amount, $3,181 was specifically identified by unit holder, while $1,228 was allocated based on revenue.
This allocation of expenses from the Parent company is a common practice in franchise systems where a parent organization provides centralized services to its subsidiaries. These services can include legal, business development, human resources, and accounting support. The costs are then distributed among the various entities, like Benjamin Franklin Plumbing, based on factors such as specific usage or overall revenue contribution.
For a prospective Benjamin Franklin Plumbing franchisee, this means that a portion of the franchise's expenses will be related to these allocated costs from the Parent. Understanding how these allocations are determined (whether by specific identification or revenue-based allocation) is important for forecasting the overall financial performance of the franchise. It also highlights the interconnectedness of the franchise with the broader parent organization and the potential impact of the Parent's financial decisions on the franchise's profitability.