Why is 'Revenue less Disclosed Expenses' not a substitution for net profit for a Bumble Roofing franchise?
Bumble_Roofing Franchise · 2025 FDDAnswer from 2025 FDD Document
Revenue less Disclosed Expenses is calculated by subtracting the total disclosed expenses and the Cost of Materials and the Cost of Labor from Revenue.
This figure is not a substitution for a net profit because that will vary based on your specific situation, debt service, entity structure, etc.
The above chart does not include all expenses incurred by the Affiliate Unit, such as an office, because we anticipate that you will operate out of a home office.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 45–50)
What This Means (2025 FDD)
According to Bumble Roofing's 2025 Franchise Disclosure Document, the 'Revenue less Disclosed Expenses' figure should not be considered a substitute for net profit. This is because net profit can vary significantly based on factors specific to each franchisee's situation. These factors include debt service, the legal structure of the business entity, and other individual circumstances.
The FDD specifies that the provided chart of revenues and disclosed costs for the affiliate unit does not include all expenses. For example, the chart does not include the cost of an office, as Bumble Roofing anticipates that franchisees will operate from a home office. This means that a franchisee who chooses to lease office space will have a different net profit than what is represented in the financial performance representation.
Therefore, while 'Revenue less Disclosed Expenses' provides a general indication of potential earnings, it is essential for prospective Bumble Roofing franchisees to conduct their own detailed financial analysis. This analysis should account for all anticipated expenses and individual financial circumstances to determine a realistic estimate of net profit.