How much did Chesters spend on purchases of equipment 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 (79,688) | |
| Customer deposits | (248,670) | 75,943 | |
| Operating lease liabilities | (181,240) | (364,784) | |
| Unearned franchise fees | 54,450 | (88,400) | |
| Other long-term liabilities | 174,238 | (00,400) | |
| Net cash provided by operating activities: | 3,544,176 | 3,029,362 | |
| CASH FLOWS FROM INVESTING ACTIVITIES | |||
| Purchases of equipment | (401,074) | (360,666) | |
| Net cash used in investing activities | (401,074) | (360,666) | |
| CASH FLOWS FROM FINANCING ACTIVITIES | |||
| Repayment of long-term debt | (1,186,667) | (725,090) | |
| Proceeds from long-term debt | 426,111 | - | |
| Distribution to members | (2,743,252) | (1,820,272) | |
| Net cash used in financing activities | (3,503,808) | (2,545,362) | |
| (DECREASE) INCREASE IN CASH | (360,706) | 123,334 | |
| CASH AT BEGINNING OF YEAR | 2,515,674 | 2,392,340 | |
| CASH AT END OF YEAR | $ 2,154,968 | $ | 2,515,674 |
| SUPPLEMENTARY DISCLOSURE OF CASH | |||
| FLOWS INFORMATION: | |||
| Cash paid during the year for interest | $ 181,560 | $ | 139,101 |
| Decrease to operating lease right-of-use assets | _ | ||
| due to contract terminations | $ 391,533 | $ | 846,599 |
| Additions to operating lease right-of-use assets obtained from operating lease liabilities | $ - | $ | 1,930,004 |
| Reduction of operating lease right-of-use assets for tenant improvements | $ - | $ | 180,000 |
| Noncash activit |
Source: Item 21 — **FINANCIAL STATEMENTS (FDD page 48)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the company spent $401,074 on equipment purchases during the year 2024. This figure is detailed within the Statements of Cash Flows, which outlines all cash inflows and outflows related to investing activities. For prospective franchisees, this indicates the level of investment Chesters makes in its own infrastructure and resources.
Understanding Chesters's capital expenditure on equipment can provide insights into the company's growth strategy and its commitment to maintaining up-to-date facilities. It is important to note that this figure reflects the franchisor's spending and not the potential investment required by a new franchisee to set up their own location. Franchisees should refer to other sections of the FDD, such as Item 7, to understand their own potential costs for equipment and build-out.
Reviewing the Statements of Cash Flows for previous years can also give potential franchisees an idea of trends in Chesters's investment activities. A consistent investment in equipment might suggest a stable and growing company, while significant fluctuations could warrant further investigation to understand the reasons behind those changes. It is also important to consider how these investments might indirectly benefit franchisees through improved systems or technologies.
It is also worth noting that the FDD includes financial statements audited by Warren Averett, LLC, indicating an independent review of Chesters's financial records. This audit provides an additional level of assurance regarding the accuracy and reliability of the financial information presented in the FDD. Prospective franchisees should carefully review all financial statements and accompanying notes to gain a comprehensive understanding of Chesters's financial health and investment activities.