What was the total value of Chesters' members' equity in 2023?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
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CHESTER'S INTERNATIONAL, LLC STATEMENTS OF INCOME AND MEMBERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022
| 2023 | 2022 | |
|---|---|---|
| SALES | $ 51,619,527 | $ 46,103,618 |
| COST OF SALES | 33,882,255 | 29,397,777 |
| GROSS PROFIT | 17,737,272 | 16,705,841 |
| SELLING AND ADMINISTRATIVE EXPENSES | 15,132,464 | 13,944,251 |
| OPERATING INCOME | 2,604,808 | 2,761,590 |
| OTHER INCOME (EXPENSE) | ||
| Interest income | 20,370 | 125 |
| Other income | 96,706 | 93,840 |
| Interest expense | (139,101) | (162,422) |
| Total other expense | (22,025) | (68,457) |
| NET INCOME | 2,582,783 | 2,693,133 |
| MEMBERS' EQUITY AT BEGINNING |
Source: Item 21 — **FINANCIAL STATEMENTS (FDD page 48)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the total value of members' equity at the end of 2023 was $4,861,345. This figure represents the ownership stake of the members in Chesters, reflecting the accumulated earnings and investments in the company up to that point. In comparison, the members' equity at the beginning of 2023 was $4,098,834, indicating an increase of $762,511 during the year. This increase is influenced by the net income of $2,582,783, offset by distributions of $1,820,272.
For a prospective franchisee, understanding the members' equity is crucial as it provides insight into the financial stability and overall health of Chesters. A growing members' equity typically suggests that the company is profitable and reinvesting earnings effectively. However, it's also important to consider factors such as distributions, which can impact the long-term growth of the equity. Distributions represent the amount of profits taken out of the business by its members, which, while beneficial to the members, can reduce the capital available for reinvestment and expansion.
It is also important to note that the financial statements have been audited by Warren Averett, LLC, which adds credibility to the reported figures. The independent auditor's report confirms that the financial statements present fairly the financial position of Chesters in accordance with accounting principles generally accepted in the United States of America. This provides potential franchisees with assurance that the financial information is reliable and has been reviewed by an independent third party.
Prospective franchisees should analyze these figures in conjunction with other financial metrics, such as revenue, expenses, and liabilities, to gain a comprehensive understanding of Chesters's financial performance. Additionally, comparing these figures to previous years and industry benchmarks can provide valuable context and help assess the company's growth trajectory and competitive position.