What is the basis for the financial performance representation provided in the Checkersrallys Franchise Disclosure Document?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
The following financial performance representation is a historic representation based on the past performance of existing Restaurants.
As used in this Item 19, "Net Sales" means all revenue derived from operating the Franchised Restaurant, including the aggregate of all sales amounts from food, beverages and other products sold and services rendered at the Premises or otherwise rendered in connection with the Franchised Restaurant, and all monies derived from sales at or away from the Franchised Restaurant, whether from cash, check, credit or debit card, barter exchange, trade credit, or other credit transactions, but: (1) excluding all federal, state or municipal sales, use or service taxes collected from customers and paid to the appropriate taxing authority; and (2) reduced by the amount of any documented refunds, credits, allowances, adjustments, promotional discounts, and charge-backs the Franchised Restaurant provides to customers in good faith. Table A comprises Net Sales information for the 121 company-owned Checkers Restaurants and the 335 franchised Checkers Restaurants that were open and operating for at least 350 days during the 52-week period ending December 30, 2024 (the "2024 Fiscal Year"). Table A does not include the Net Sales for 2 company-owned and 27 franchised Checkers Restaurants that were open for less than 350 days during the 2024 Fiscal Year. Table A also excludes 3 company-owned and 35 franchised Checkers Restaurants that were closed during the 2024 Fiscal Year.
Table B comprises Net Sales information during the first 52-week period of operations for the 2 company-owned Checkers Restaurant and the 37 franchised Checkers that opened between January 2022 and December 2024. Table B does not include the Net Sales for 18 franchised Checkers Restaurants because they did not have a full 52-week period of operation.
For purposes of this Item 19, "Average Net Sales" means the mean average amount of reported Net Sales, and "Median Net Sales" means the midpoint amount of reported Net Sales. The Net Sales figures for franchised Checkers Restaurants were derived from
unaudited financial reports submitted by franchisees for the purpose of computing royalties. We compiled the Net Sales figures for company-owned Checkers Restaurants on the basis of generally accepted accounting principles, consistently applied.
Some outlets have earned this amount. Your individual results may differ. There is no assurance that you'll earn as much.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 71–77)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the financial performance representation is a historic representation based on the past performance of existing Restaurants. The Item 19 information details the Net Sales information for both Checkers and Rally's restaurants. The Net Sales information is separated into Table A and Table B. Table A comprises Net Sales information for restaurants open and operating for at least 350 days during the 52-week period ending December 30, 2024. Table B comprises Net Sales information during the first 52-week period of operations for restaurants that opened between January 2022 and December 2024.
For the purposes of Item 19, "Net Sales" means all revenue derived from operating the Franchised Restaurant, including the aggregate of all sales amounts from food, beverages and other products sold and services rendered at the Premises or otherwise rendered in connection with the Franchised Restaurant, and all monies derived from sales at or away from the Franchised Restaurant, whether from cash, check, credit or debit card, barter exchange, trade credit, or other credit transactions, but excluding sales, use or service taxes collected from customers and paid to the appropriate taxing authority and reduced by the amount of any documented refunds, credits, allowances, adjustments, promotional discounts, and charge-backs the Franchised Restaurant provides to customers in good faith. The Net Sales figures for franchised Checkers Restaurants were derived from unaudited financial reports submitted by franchisees for the purpose of computing royalties. Checkersrallys compiled the Net Sales figures for company-owned Checkers Restaurants on the basis of generally accepted accounting principles, consistently applied.
It is important to note that the Checkersrallys FDD states that some outlets have earned the amounts represented, but individual results may differ, and there is no assurance that a franchisee will earn as much. Checkersrallys will provide written substantiation for the financial performance representations upon reasonable request, but will not disclose the identity or sales data of any particular Restaurant without the owner's consent, except to applicable state registration authorities or in connection with the sale of a particular existing Restaurant that Checkersrallys owns. The FDD also advises that if a prospective franchisee receives any other financial performance information or projections of future income, they should report it to the franchisor's management, the Federal Trade Commission, and the appropriate state regulatory agencies.