What costs are specifically excluded from 'COGS' for a Bigfoot Forestry business and where are they included?
Bigfoot_Forestry Franchise · 2025 FDDAnswer from 2025 FDD Document
- "COGS" or "Cost of Goods Sold" includes variable costs that are directly associated with the provision and delivery of Bigfoot Forestry Services, including any materials necessary for completion of a project. COGS does not include Fuel Costs or Labor Costs which are included under Operating Expenses. In most cases, Bigfoot Forestry Businesses do not incur any COGS (other than Fuel Costs and Labor Costs where are listed as separate line items under Operating Expenses).
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 36–39)
What This Means (2025 FDD)
According to Bigfoot Forestry's 2025 Franchise Disclosure Document, Cost of Goods Sold (COGS) includes variable costs directly associated with providing and delivering Bigfoot Forestry services, including materials needed for project completion. However, the definition of COGS specifically excludes fuel costs and labor costs. These excluded costs are instead categorized and included under Operating Expenses.
For a prospective Bigfoot Forestry franchisee, this distinction is important for understanding the financial performance metrics presented in Item 19. By excluding fuel and labor from COGS and including them in Operating Expenses, Bigfoot Forestry provides a clearer picture of the direct material costs associated with each project. This categorization can help franchisees better manage their expenses and analyze the profitability of individual jobs.
In most cases, Bigfoot Forestry businesses do not incur any COGS other than fuel and labor costs, which are listed as separate line items under Operating Expenses. This suggests that the primary costs for franchisees will be related to fuel for equipment and vehicles, as well as labor expenses for employees. Understanding this breakdown is crucial for budgeting and financial forecasting.