What was the total operating lease cost for Carls as of January 31, 2023?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
uary 31 , 2023, future minimum lease and sublease rent revenue expected to be received, are as follows:
| Finance Leases | Operating Leases | |||||
|---|---|---|---|---|---|---|
| Subleases | Subleases | Owned Properties | ||||
| Fiscal: | ||||||
| 2024 $ | 285 | $ 85,213 | $ | 9,185 | ||
| 2025 | 246 | 73,6 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, the total operating lease cost for the fiscal year 2023 was $94,640. This figure includes the operating lease cost of $93,249 and a variable lease cost of $1,391.
For a prospective Carls franchisee, understanding the components of lease costs is crucial. Operating leases typically cover the use of property and equipment, while variable lease costs can fluctuate based on factors like usage or sales performance. These costs are part of the overall expenses that a franchisee must account for when assessing the financial viability of the franchise.
It's important to note that these figures represent Carls's costs as a company, and individual franchisees' lease costs may vary depending on their specific location, lease terms, and other factors. Therefore, a potential franchisee should carefully review the lease agreements for their specific location and consult with a financial advisor to understand the full financial implications.