What is the purpose of 'Imputed Fees & Costs' for a Bigfoot Forestry franchise?
Bigfoot_Forestry Franchise · 2025 FDDAnswer from 2025 FDD Document
Gross Sales*" means total revenue generated by the Qualifying Outlet minus: (a) taxes; and (b) refunds.
- "Imputed Fees & Costs" includes: (a) Brand Fund Fees (1% of Gross Sales); (b) the difference between the Local Marketing Commitment (what franchisees must spend on local marketing) and the actual marketing expenses incurred by the Qualifying Outlet; (c) Royalty Fees (calculated according to a sliding royalty scale based on Gross Sales bracket, as further described in Item 6); and (d) technology fees ($350 per month). Imputed Fees & Costs are intended to capture the additi
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 36–39)
What This Means (2025 FDD)
According to Bigfoot Forestry's 2025 Franchise Disclosure Document, 'Imputed Fees & Costs' are designed to represent the expenses a franchised outlet would typically incur but that a company-owned outlet might not. These imputed costs help provide a more accurate comparison of financial performance between the two types of business models. Specifically, Imputed Fees & Costs include Brand Fund Fees (1% of Gross Sales), the difference between the Local Marketing Commitment and actual marketing expenses, Royalty Fees, and technology fees ($350 per month).
For a prospective Bigfoot Forestry franchisee, understanding Imputed Fees & Costs is crucial for accurately assessing potential profitability. The company-owned outlet does not pay brand fund fees, royalty fees, or technology fees, and isn't required to spend a minimum on local marketing. By including these 'Imputed Fees & Costs' in the financial performance representation, Bigfoot Forestry aims to provide a more realistic view of the expenses a franchisee can expect. This allows potential franchisees to see an 'Adjusted EBITDA' that reflects these standard franchise-related expenses.
The FDD shows that the company-owned outlet's actual expenses are compared to what a franchisee would typically pay. For example, the company-owned outlet incurred $5,447 in expenses for goods and services covered by the technology fee, exceeding the $4,200 plus $504 for email accounts that a franchisee would have incurred. Similarly, the company-owned outlet spent $15,697 on local advertising, exceeding the minimum $14,764 a franchisee would have been obligated to spend. In these cases, the 'Imputed Fees & Costs' section reflects $0 because the company-owned outlet's actual spending was higher than the hypothetical franchise requirements. This detailed breakdown helps potential franchisees understand how the financial performance of the company-owned outlet translates into a realistic expectation for a franchised business, accounting for mandatory fees and expenses.