Are cash flows included in Buona's financial statements?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
The statements shown in the tables DO NOT include the following expense items, which must be calculated and included separately for every Buona Restaurant:
- Actual Local Advertising, including promotional discounts done at the POS.
- Depreciation of property and equipment.
- Rent, interest or other financing cost for land, buildings, equipment and inventory.
- Initial franchise fee and organization costs.
- Any management fees.
- Income taxes and property taxes.
- Other Employee benefits, such as bonus incentives, meal discounts, other team member compensation.
- Other expenses, such as furniture & equipment, technology software & equipment, meeting expense, cash over/short, credit card chargebacks, armored car, & window washing services.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, the financial statements do not include cash flow information. Item 19 outlines various expenses that are not included in the financial performance representations provided. These exclusions mean that the provided financial data does not present a complete picture of the costs associated with operating a Buona franchise.
Specifically, the financial performance representations do not account for expenses such as local advertising, depreciation of property and equipment, rent, interest, financing costs, initial franchise fees, organizational costs, management fees, income taxes, property taxes, employee benefits, and other operational expenses. These exclusions are significant because they represent substantial costs that a franchisee will incur. Without considering these expenses, a prospective franchisee may overestimate the potential profitability of a Buona restaurant.
Therefore, it is crucial for potential franchisees to independently calculate and include these missing expense items when evaluating the financial performance representations. This will provide a more realistic understanding of the potential net income or profit. The FDD explicitly advises prospective franchisees to seek advice from financial, business, and legal advisors to assess the financial viability of the franchise opportunity, considering all relevant factors and expenses.