Does Beyond Juicery Eatery have any obligation to inform the franchisee if they discount receivables?
Beyond_Juicery_Eatery Franchise · 2025 FDDAnswer from 2025 FDD Document
ranchised stores open and operating.
Note 2 - Significant Accounting Policies
Restricted Cash
The Company has restricted cash equal to the amount of unspent advertising funds on deposit. A total of $0, $21,982, and $945 of cash is restricted for that purpose at December 31, 2024, 2023, and 2022, respectively.
Trade Accounts Receivable
Accounts receivable are stated at net invoice amounts. An allowance for expected credit losses is established for accounts receivable based on a combination of factors, including the aging of receivables, historical collection trends, and charge-offs, and includes adjustments for current economic conditions and reasonable and supportable forecasts. When the Company is aware of a franchise or customer's inability to meet its financial obligation, the Company may individually evaluate the related receivable to determine the allowance for expected credit losses. All amounts deemed to be uncollectible are charged against the allowance for expected credit losses in the period that determination is made. The allowance for expected credit losses on accounts receivable balances was $18,563 at December 31, 2024. At December 31, 2023, and 2022, the Company did not record an allowance for credit losses, as the Company determine
Source: Item 10 — FINANCING (FDD pages 33–34)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, it is not clear whether Beyond Juicery Eatery has any obligation to inform a franchisee if they discount receivables. The FDD excerpts provided discuss various aspects of the franchise agreement, including fees, revenue recognition, supplier relationships, and site selection. However, none of the excerpts explicitly address the franchisor's obligation to inform franchisees about discounting receivables.
Item 23 mentions trade accounts receivable and the allowance for expected credit losses. It states that accounts receivable are recorded at net invoice amounts, and an allowance is established based on factors like aging of receivables and historical collection trends. The allowance for expected credit losses on accounts receivable balances was $18,563 as of December 31, 2024. For the years ended December 31, 2023, and 2022, the company did not record an allowance for credit losses, determining there was minimal risk. However, this does not clarify whether franchisees would be notified if receivables are discounted.
To fully understand Beyond Juicery Eatery's policies regarding the discounting of receivables and any notification obligations to franchisees, prospective franchisees should ask the franchisor directly about this specific issue. Further clarification should be sought regarding the circumstances under which receivables might be discounted and whether franchisees would be informed of such actions.