What is the gross revenue from subleases with Checkersrallys franchisees included in the total revenue from franchisee purchases?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
d unusual personal gain.
Items We Supply or Derive Revenue From
We and our affiliates may receive revenues from required purchases and leases of products and services by franchisees. The revenues are collected by approved suppliers or distribution centers on behalf of the system and are paid to us. Our total revenues for the fiscal year which ended December 30, 2024 were $300,381,238 of which $6,189,551 or 2.1% were revenues from required purchases and leases of products and services by franchisees. Our total revenue from franchisee purchases includes $2,225,520 in gross revenue from subleases with franchisees. We generally collect rent as a pass through for landlords on the underlying lease but may earn a profit. We did not earn any profit from subleases during our 2024 fiscal year. Our intention is not to earn a profit, but instead to use all revenues collected from franchisee and company-owned restaurant purchases of products and services to offset expenses we incur in administering system-wide programs such as people, guest and operations programs, insurance procurement, promotional and price management tools, supply chain programs, brand protection (including quality assurance and food safety) programs and research and development. However, we may earn a profit from franchisees' required purchases and leases of products and services.
Our affiliate, CDSI, also earned $7,890,469.14 in gross revenue from required purchases and leases
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 39–44)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the total revenues for the fiscal year which ended December 30, 2024, were $300,381,238. Of this amount, $6,189,551, or 2.1%, was revenue from required purchases and leases of products and services by franchisees. The total revenue from franchisee purchases includes $2,225,520 in gross revenue from subleases with franchisees.
Checkersrallys collects rent as a pass-through for landlords on the underlying lease but may earn a profit. However, Checkersrallys did not earn any profit from subleases during the 2024 fiscal year. The intention of Checkersrallys is not to earn a profit, but instead to use all revenues collected from franchisee and company-owned restaurant purchases of products and services to offset expenses incurred in administering system-wide programs. These programs include people, guest and operations programs, insurance procurement, promotional and price management tools, supply chain programs, brand protection (including quality assurance and food safety) programs, and research and development.
It is important to note that while Checkersrallys aims to offset expenses with these revenues, they may still earn a profit from franchisees' required purchases and leases of products and services. Additionally, an affiliate, CDSI, earned $7,890,469.14 in gross revenue from required purchases and leases of products and services by franchisees during the 2024 fiscal year.