What royalty fees were imputed for the Bigfoot Forestry Company-Owned Outlet in the EBITDA calculation?
Bigfoot_Forestry Franchise · 2025 FDDAnswer from 2025 FDD Document
in Notes 3, 4 and 5 below.
- 3. Imputed Royalty & Brand Fund Fees: Our Company-Owned Outlet did not pay royalty fees or brand fund fees during the Measuring Year. In the Imputed Fees & Costs section of the EBITDA calculation, we have included the roya
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 36–39)
What This Means (2025 FDD)
According to Bigfoot Forestry's 2025 Franchise Disclosure Document, the company-owned outlet did not actually pay royalty fees during the measuring year. However, for the purpose of calculating the Adjusted EBITDA, royalty fees of $44,945 were imputed. This imputation represents what the company-owned outlet would have paid had it been a franchised outlet.
The royalty fees are part of the 'Imputed Fees & Costs' section of the EBITDA calculation. This section aims to show potential franchisees the additional fees and expenses they would incur as a franchisee, which are not incurred by a company-owned outlet. The document specifies that franchised outlets must pay royalty fees, which range from 4.5% to 7% of gross sales, depending on the gross sales bracket.
By including these imputed costs, Bigfoot Forestry provides a more realistic view of the potential profitability for a franchisee. This allows prospective franchisees to understand the financial impact of these fees on their potential earnings. The Adjusted EBITDA, which accounts for these imputed fees, offers a more conservative estimate of financial performance compared to the EBITDA based solely on the company-owned outlet's actual expenses.