Why does Byrider Franchising Partners use a 2-year annual average for Byrider Businesses?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
d together with the Franchisee Complete Set, the "Complete Set").
For Tables A-1 and A-2 below, Byrider Franchising Partners compiled the data for Byrider Businesses that make up the Franchisee Complete Set, using composites from December 31, 2022 and December 31, 2023, that are not independently audited, using a 2-year annual average, because Byrider Businesses require that loss reserves be established at the time a car is sold and a retail installment contract is initiated. Byrider Franchising Partners compiled the same data for the Byrider Businesses that make up the Company-Owned Complete Set in Tables A-3 and A-4 and did the same for all Byrider Businesses in the Complete Set in Tables A-5 and A-6.
Tables B-1 and B-2 below provides separate figures related to the operations of each of the 92 Franchisee-Owned Stores in the Franchisee Complete Set during 2022 and 2023. Tables B-3 and B-4 below provides separate similar figures related to the operations of each of the 8 Company-Owned Stores in the Company-Owned Complete Set during and 2022 and 2023. Tables B-5 and B-6 below provides separate similar figures related to the operations of each of the 100 Byrider Businesses in the Complete Set during 2022 and 2023.
In each instance in which Byrider Franchising Partners shows an average of a category, Byrider Franchising Partners calculated the average by adding the total amount of that same category for the particular period of time for the franchisee-owned stores in the group, then divided those numbers by the number of franchisee-owned stores in the group. In each instance in which Byrider Franchising Partners shows an average, Byrider Franchising Partners also shows the lowest and highest points in the data set and the median data point. The median is the middle data point; that is, the data point in the center of all data points. Where the number of data points is an even number, there is no middle data point, so the median is the average of the two middle data points.
Source: Item 19 — Financial Performance Representations (FDD pages 63–81)
What This Means (2025 FDD)
According to the 2025 Byrider Franchise Disclosure Document, Byrider Franchising Partners uses a 2-year annual average when compiling financial data for Byrider Businesses. Specifically, the data in Tables A-1 and A-2, which pertains to the Franchisee Complete Set, uses composites from December 31, 2022, and December 31, 2023. This 2-year averaging method is also applied to the Company-Owned Complete Set in Tables A-3 and A-4, as well as the Complete Set in Tables A-5 and A-6.
The reason Byrider uses this 2-year average is because Byrider Businesses are required to establish loss reserves at the time a car is sold and a retail installment contract is initiated. This practice of establishing loss reserves upfront impacts the financial figures, necessitating the use of a multi-year average to provide a more stable and representative view of financial performance.
For a prospective franchisee, this means that the financial performance data presented is not based on a single year's snapshot but rather an average of two years. This approach aims to smooth out any short-term fluctuations and provide a more reliable indication of potential financial outcomes. However, it's important to remember that past performance is not necessarily indicative of future results, and individual results may vary. Byrider will provide written substantiation for this financial information to prospective franchisees upon reasonable request.