Does Chocolate Fish Coffee guarantee that a franchisee will achieve the same sales or earnings as some existing outlets?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
- 5. Some outlets have sold and earned this amount. Your individual results may differ. There is no assurance that you'll sell or earn as much.
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- Written substantiation of the information contained in this Item 19 will be made available to prospective franchisees upon reasonable request.
Except for what is included in this Item 19, we do not make any representations about a franchisee's future financial performance or the past financial performance of company-owned or franchised outlets. We also do not authorize our employees or representatives to make any such representations either orally or in writing. If you are purchasing an existing outlet, however, we may provide you with the actual records of that outlet. If you receive any other financial performance information or projections of your future income, you should report it to the franchisor's management by contacting, Ali Syed and Asif Alvi, 9581930 N. Gould St., Ste R, Sheridan, WY 82801, and (925) 922-1875 or (408) 396-9301, the Federal Trade Commission, and the appropriate state regulatory agencies.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 37–38)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, Chocolate Fish Coffee does not guarantee that a franchisee will achieve the same sales or earnings as some existing outlets. While some outlets have attained certain sales and earnings levels, the FDD explicitly states that individual results may vary, and there is no assurance that a new franchisee will achieve similar financial performance.
The financial performance representation included in Item 19 of the FDD is based on the historic financial performance of three company-owned locations from September 1, 2022, through September 30, 2023. The FDD provides data on gross sales, estimated royalty fees, and estimated brand fund contributions for these locations. For example, one location had gross sales of $850,850.75, with estimated royalty fees of $51,051.05 and an estimated brand fund contribution of $8,508.51. Another location had gross sales of $531,854.48, with estimated royalty fees of $31,911.27 and an estimated brand fund contribution of $5,318.54. A third location had gross sales of $828,545.45, with estimated royalty fees of $49,712.73 and an estimated brand fund contribution of $8,285.45.
The FDD emphasizes that these figures are not projections of future performance and do not reflect the costs of sales, operating expenses, or other costs that must be deducted to determine net income or profit. Prospective franchisees are advised to conduct their own independent investigation of the costs and expenses they will incur. The FDD also notes that Chocolate Fish Coffee does not make any representations about a franchisee's future financial performance, except for what is included in Item 19, and does not authorize employees or representatives to make such representations. However, if a prospective franchisee is purchasing an existing outlet, Chocolate Fish Coffee may provide the actual records of that outlet.