What was the change in Chesters' customer deposits in 2024?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
LOWS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023
| CASH FLOWS FROM OPERATING ACTIVITIES | _ | _ | |
|---|---|---|---|
| Net income | $ (69,699) | $ | 2,582,783 |
| Adjustments to reconcile net income to net cash | |||
| provided by operating activities: | |||
| Loss on disposal of fixed assets | 9,969 | - | |
| Amortization and depreciation | 522,927 | 462,783 | |
| Amortization of operating lease right-of-use assets | 189,709 | 387,265 | |
| Changes in operating assets and liabilities: | (4 = 00 000) | ||
| Accounts receivable | 3,642,762 | (1,563,980) | |
| Other receivables | (421,459) | (400,405) | |
| Due from related parties | (237,110) | (433,495) | |
| Inventories | 1,247,308 | (116,596) | |
| Prepaid expenses and other current assets | (89,469) (1,834,402) | (17,181) | |
| Accounts payable Accrued liabilities | 784,862 | 2,184,712 (79 |
Source: Item 21 — **FINANCIAL STATEMENTS (FDD page 48)
What This Means (2025 FDD)
According to Chesters' 2025 Franchise Disclosure Document, there was a decrease in customer deposits in 2024. The customer deposits decreased by $248,670 in 2024, compared to an increase of $75,943 in 2023. This represents the change in operating assets and liabilities related to customer deposits during that year.
For a prospective Chesters franchisee, this indicates a shift in how customers are paying for goods or services. A decrease in customer deposits could mean that more customers are paying at the time of service rather than making advance deposits. This could impact the franchisee's cash flow management and working capital needs.
It's important to note that this change is just one element within the broader context of Chesters' financial performance. Franchisees should consider these figures in conjunction with other financial metrics, such as revenue, expenses, and overall profitability, to gain a comprehensive understanding of the business's financial health. Additionally, prospective franchisees may want to inquire with Chesters about the reasons behind this change and whether it is expected to continue in the future.