Does Better Blend maintain cash balances that exceed federally insured limits?

According to Better Blend's 2024 Franchise Disclosure Document, the company acknowledges that it maintains cash balances in financial institutions that, at times, may exceed federally insured limits. This means that Better Blend's deposits in banks could be greater than the amount insured by the Federal Deposit Insurance Corporation (FDIC), which currently insures deposits up to $250,000 per depositor, per insured bank.

For a prospective Better Blend franchisee, this disclosure indicates a potential risk, although Better Blend management monitors the financial condition of these institutions and does not anticipate any losses. If the financial institutions were to fail, Better Blend could potentially lose uninsured funds. This situation is not uncommon for businesses that handle significant cash flow.

Better Blend states that it is subject to credit risk if any financial institution it conducts business with cannot fulfill its contractual obligations. However, Better Blend management monitors the financial condition of such financial institutions and does not anticipate any loss from these obligations. While Better Blend believes the risk of loss is low, franchisees should be aware of this potential risk and may want to inquire about Better Blend's cash management practices and risk mitigation strategies.